By Elizabeth Woodcock, MBA, FACMPE, CPC
Medscape, January 29, 2020

If you’ve knocked yourself out to earn a Merit-based Incentive Payment System (MIPS) bonus payment, it’s pretty safe to say that getting a 1.68% payment boost probably didn’t feel like a “win” that was worth the effort.

And although it saved you from having a negative 5% payment adjustment, many physicians don’t feel that it was worth the effort.

Based on 2018 participation, the bonus for those who scored a perfect 100 is only a 1.68% boost in Medicare reimbursement, slightly lower than last year’s 1.88%.

Overall, more than 97% of participants avoided having a negative 5% payment adjustment.

Indeed, these bonus monies are based on a short-term appropriation of extra funds from Congress. After these temporary funds are no longer available, there will be little, if any, monies to distribute as the program is based on a “losers-feed-the-winners” construct.

It may be very tempting for many physicians to decide to ignore MIPS, with the rationale that 1.68% is not worth the effort. But don’t let your foot off the gas pedal yet, since the penalty for not participating in 2020 is a substantial 9% (in perpetuity). Physicians should make sure that they, at minimum, achieve the 45 points necessary to avoid that pitfall this reporting year.

Physicians are spending a significant amount of money to comply with the program requirements. This includes substantial payments to registries—typically $200 to >$1000 per year—to report the quality measures for the program; electronic health record (EHR) systems, many of which require additional funding for the “upgrade” to a MIPS-compatible system, are also a sizable investment.

These hard costs pale in comparison with the time spent on understanding the ever-changing requirements of the program and the process by which your practice will implement them.

(Electronic Referral Loops) is only one of more than a dozen required elements: six quality measures, two (to four) improvement activities, and four promoting interoperability requirements. Each one of these elements has a host of requirements, all listed on multipage specification sheets.

In 2020, the threshold to avoid the penalty is 45 points. In order to get the 45 points, practices must participate in two improvement activities, which is not difficult as there are 118 options. That will garner 15 points. Then there are 45 points available from the quality category; you need at least 30 to reach the 45-point threshold for penalty avoidance.

To obtain the additional 30 points, turn your attention to the quality category. There are 268 quality measures; choose at least six to measure. If you report directly from your EHR system, you’ll get a bonus point for each reported measure, plus one just for trying.

The quality category has a total of 100 points available, which are converted to 45 toward your composite score. Since you need 30 to reach that magical 45 (if 15 were attained from improvement activities), that means you must come up with 75 points in the quality category.

There are two other categories in the program: promoting interoperability (PI) and cost. The PI category mirrors the old “meaningful use” program; however, it has become increasingly difficult over the years. If you think that you can meet the required elements, you can pick up 25 more points toward your composite score.

Cost is a bit of an unknown, as the scoring is based on a retrospective review of your claims. You’ll likely pick up a few more points on this 15-point category, but there’s no method to determine performance until after the reporting period. Therefore, be cautious about relying on this category.

MIPS is not going anywhere; the program is written into the law.

But that doesn’t mean that CMS can’t make tweaks and updates. Hopefully, the revisions won’t create even more administrative burden as the program is quickly turning into a big stick with only a small carrot at the end.

https://www.medscape.com…

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Explaining MIPS

Comment by Don McCanne, M.D.
Quote of the Day, March 2015

On reading the summary of the “SGR Repeal and Medicare Provider Payment Modernization Act,” you will see that MIPS places a tremendous administrative burden on health care professionals in a health care system that is already overwhelmingly overburdened with administrative excesses. The only way to escape this additional burden is to participate in Alternative Payment Models (APMs) which, in themselves, create further significant administrative burdens (ACOs, PCMHs, etc.). MIPS is an administrative nightmare.

Under the MIPS payment system, eligible professionals with higher scores will receive positive payment adjustments (and may be eligible for an additional incentive payment). We have observed repeatedly how such systems are gamed in order to receive these extra payments. The problem is that those who do not game the system, and especially those with practice situations and patient populations that make it very difficult to score higher points, will almost automatically receive performance scores below the threshold since their performances will be compared with the gamers. This will result in negative payment adjustments – reducing payments by up to nine percent.

This is serious. And it is being steamrolled through Congress right now! Those who care about the future of Medicare and who do have organizational skills must immediately inform themselves on what is happening here. Then act. You cannot wait to watch the Congressional vote tally on C-Span, perhaps as early as this week (2015). By then it will be a done deal.

https://pnhp.org…

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Comment:

By Don McCanne, M.D.

There was a great celebration when Congress agreed to repeal the flawed SGR formula for adjusting Medicare payment rates. Unfortunately, the voices of those of us who were very concerned about its replacement – MIPS – fell on deaf ears. We are now living with the MIPS mess.

To avoid a nine percent penalty in Medicare payments physicians must comply with the administrative hassle described briefly above. Nobody benefits from this; it has not even improved quality – its avowed intent. Those who attempt to qualify for bonus payments are disappointed since the bonuses are funded by the penalties, and most avoid the penalties by accepting the administrative burden since a nine percent penalty is excessively punitive.

The net result is that we have added a greater administrative burden to a system already overwhelmed with very expensive administrative excesses with the reward being merely avoidance of a monetary penalty, without extra funds being appropriated for potential of paltry rewards.

CMS continues to push this program, presumably based on the fiction that it improves value. If they really wanted greater value in health care, they should look at the $600 billion in recoverable administrative waste that we could free up by enacting and implementing a well designed, single payer, improved Medicare for All. Enough with the MIPS mess.

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By Richard Kronick
Health Affairs Blog, January 29, 2020

In the Deficit Reduction Act of 2005, Congress gave the Centers for Medicare and Medicaid Services (CMS) the statutory authority and obligation to implement a “coding intensity adjustment” for Medicare Advantage (MA) plans, to adjust for differences in patterns of diagnosis coding between MA and traditional Medicare.

Under both the Obama and Trump administrations, the coding intensity adjustment implemented by CMS has consistently been substantially smaller than justified by the data. The fiscal problem created by inadequate adjustment for coding intensity is large. Under reasonable assumptions about the rate of growth of MA coding, CMS will overpay MA plans by $200 billion over the next decade if the coding intensity adjustment remains at 5.91 percent, its current level.

Why does this overpayment persist? The annual decision about the size of the coding intensity adjustment is made by political appointees at CMS, the Department of Health and Human Services, and the White House, and the political benefits from implementing a smaller than empirically justified coding intensity adjustment far outweigh the potential political gains from protecting the taxpayers and creating a stable and level playing field between MA and traditional Medicare.

The Problem

CMS pays MA plans based on the health status of the beneficiaries who enroll, paying more for older and sicker enrollees and less for younger and healthier enrollees. This “risk adjusted” payment mechanism is intended to encourage MA plans to develop systems of care that are attractive to beneficiaries most in need and to prevent MA plans from profiting by attracting only good risks.

The health status of MA enrollees is measured using diagnostic information submitted by the MA plans themselves. As a result, MA plans have strong incentives to identify and report as many diagnoses as can be supported by the medical record, incentives that are not present in traditional Medicare. Although some MA plans may have used fraudulent strategies to inflate enrollee risk scores, many legitimate strategies are available to MA to increase risk scores.

Discretion For CMS

Recognizing the likelihood that MA plans will report diagnostic information differently than is reported in traditional Medicare, in the Deficit Reduction Act of 2005, Congress gave CMS the authority to implement a “coding intensity adjustment” to adjust for differences in coding patterns between MA and traditional Medicare. In 2010, CMS implemented a 3.41 percent coding intensity adjustment, reducing MA risk scores by that amount. The Affordable Care Act, and subsequently the American Taxpayers Relief Act of 2012, created a schedule of minimum adjustments, starting at 4.71 percent in 2014, increasing to 5.91 percent in 2018.

CMS retained the authority and obligation to implement adjustments larger than the statutory minimum if the data indicated that a larger adjustment was needed. However, it has not yet done so, despite strong evidence that a larger adjustment is needed to compensate for differences between MA and traditional Medicare in coding patterns. The measured risk of MA enrollees relative to traditional Medicare increased from 95.0 percent in 2007 to 106.2 percent in 2015.

MA enrollment grew substantially from 2007 to 2015, and it is theoretically possible that the increase in relative risk reflects real changes in the relative health of MA enrollees. However, analyses of other data sources—including mortality rates, survey data from the Medicare Current Beneficiary Survey, data on switchers from traditional Medicare to MA, and prescription drug use data—show conclusively that there was little, if any, change in real relative risk over this time period. The 11-percentage-point increase in measured relative risk from 2007 to 2015 appears largely to be the result of differences in coding patterns between MA and traditional Medicare.

Perverse Political Incentives

The main reason that CMS has not implemented a larger coding intensity adjustment is that there is little political gain from doing so, and the decision about the coding intensity adjustment is, ultimately, made by political appointees. If CMS were to implement an adjustment that is larger than the statutory minimum, MA plans would make their displeasure known to members of Congress. Furthermore, an adjustment larger than the statutory minimum might result in higher MA premiums or fewer extra benefits for enrollees, raising the likelihood of constituent dissatisfaction.

In even numbered years, information on MA premiums and benefits is made public soon before the November elections. Members of Congress (and, every four years, the president) are concerned that voters, likely encouraged by information fed to them by MA plans, may blame incumbents for increased premiums or reduced benefits. This is not a merely theoretical argument: Federal legislators have repeatedly exerted strong bipartisan pressure on CMS in response to industry and constituent concerns about MA payment policy.

The political cost of more aggressive action by CMS on coding intensity is clear. The political benefits are much less clear: The deficit would be slightly smaller but not enough to change interest rates or anything else that voters would notice. Given this imbalance between political costs and benefits, it is not surprising that CMS has stuck with the statutory minimum, despite strong evidence that larger adjustments are warranted.

A Better, More Practical Approach

An alternative, and, in my view, preferable approach would be to require CMS to calculate the coding intensity adjustment using a method that CMS floated as a trial balloon in the Advance Notice for 2016 MA rates.

(For details, use the link below.)

Summing Up

Under reasonably conservative assumptions about the rate of growth of coding intensity, using the budget neutrality method to calculate coding intensity would likely result in approximately $200 billion in savings to Medicare over the next decade compared to current policy in which the coding intensity adjustment remains at 5.91 percent. Just as CMS is reluctant to anger the MA industry and its enrollees, members of Congress will be reluctant as well. However, unlike CMS, which does not get to spend any of the savings generated by more appropriate actions on coding intensity, Congress can choose to use the $200 billion in savings for additional spending or tax cuts, providing reason to hope that legislators will, at some point, do the right thing.

https://www.healthaffairs.org…

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Comment:

By Don McCanne, M.D.

Why was Medicare enacted? Wasn’t the private insurance industry fulfilling the role of financing health care? Well, not for seniors. With their higher health care needs and limited income from social security or modest pensions, the market of seniors who could afford private health insurance was too small. Thus, as governments should do, they filled the void with publicly-funded Medicare.

Since Medicare was functioning quite well, why did we need to add the option of private Medicare plans? It was not to benefit Medicare beneficiaries, but rather it was to give private health plans access to the government funds in order to expand their business model of health care financing.

The insurance industry convinced Congress that they could provide higher quality care at a lower cost and thus the Medicare + Choice program was established. It turned out they couldn’t and enrollment began declining. But the insurance industry wouldn’t give up, and they convinced Congress that the rules needed to be changed, and thus Medicare Advantage was enacted to replace Medicare + Choice. Profits were still the motivating factor.

The industry devised devious methods of selectively marketing their products to the healthy while being reimbursed at rates more appropriate for the less healthy individuals who remained in the traditional fee-for-service sector. It did not take long to recognize this scheme and thus a system of risk adjustment was established such that payments for those at higher risk were greater than payments for those at average risk. The industry then responded in several ways to game the system for higher payments, but the most important was to add diagnoses (upcode) to make their comparatively healthy patients appear sicker than they were, for instance making house calls to snoop around to see if other diagnoses could be added such as recording a diagnosis that would explain a grab bar in the bathroom, or recording a single high blood pressure in a patient offended by this intrusion. You should read the full article by Richard Kronick (link above) to understand how the legislators and bureaucrats responded to make this work for the insurers.

And it is still working to bolster their profits. Their enrollment continues to increase (their beneficiaries seem to be oblivious to their shenanigans, and in this age of tolerance of ethical compromise, they probably wouldn’t care anyway). Further, their performance in the stock market has pleased their shareholders, and between profits and stock appreciation, the political pressure they place on legislators of both major parties is actually welcome since it is accompanied by… (see OpenSecrets.org).

In the full article, Professor Kronick suggests an approach that would recover about $200 billion in overpayments over a decade. As a beneficial tweak, it should be enacted. However, it does not correct many of the other inherent flaws of including private health plans in a fragmented, dysfunctional system of financing health care. The private plans were devised for the purpose of diverting our health care dollars to a business entity – the insurance industry – an industry that doesn’t even provide health care services to patients (though that is changing as they move sectors of the health care delivery system into their enterprises – converting a service industry into an entrepreneurial business model).

No, we need to change the financing infrastructure into one that is designed exclusively to provide essential health care services for everyone while dumping the rent seekers that are screwing up our health care for their own personal gain. The obvious: We need to enact and implement a well designed single payer model of an improved Medicare for All.

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CMS.gov, January 30, 2020

The Centers for Medicare & Medicaid Services (CMS) is announcing a new opportunity to support states with greater flexibility to improve the health of their Medicaid populations. The Healthy Adult Opportunity (HAO) emphasizes the concept of value-based care while granting states with extensive flexibility to administer and design their programs within a defined budget.

Financing and Program Integrity

States participating in HAO demonstrations will need to agree to operate their program within a defined budget target, set on either a total expenses or per-enrollee basis, in a manner similar to that used in other section 1115 demonstrations. Total expenditures for covered populations in excess of the annual budget will not be eligible for Federal Financial Participation. The targets will be negotiated based on the state’s own historic costs and other factors like national and regional trends. The financial parameters will be tied to inflation and adjustments may be made for extraordinary events. CMS will closely work with states to set a realistic baseline.

Under the total expenses model, CMS will calculate a base year amount using prior year expenditures based on the populations and benefits included in the state’s demonstration. CMS will trend this amount forward to each demonstration year without regard to changes in Medicaid enrollment. While available funding will be capped in the aggregate, states will not have the ability to cap enrollment and still receive the enhanced federal match rate available to the expansion population. States agreeing to the total expense model will be required to maintain spending on health services at a level at least 80% of the target amount. To the extent they achieve savings and demonstrate no declines in access or quality, CMS will share back a portion of the federal savings for reinvestment into Medicaid. The amount of shared savings available for reinvestment would increase based on commensurate improvements in quality and access measures.

Under the per enrollee model, CMS will determine a per enrollee base amount for each eligibility group included in the demonstration using prior year expenditures. If prior year expenditures for the covered population are unavailable, the base year amount will be determined initially considering national/regional expenditures and other relevant information, and will be subject to rebasing to ensure accuracy. CMS will trend each group’s base amount forward to the demonstration year and then multiply the trended base amount by the number of enrollees for that year. The amount for each group will be added together to create an overall per capita cap. Therefore, the per-enrollee budget amount will fluctuate based on enrollment, while the aggregate cap budget amount will not.

Under both models, states will be required to participate in program integrity and financial oversight activities to ensure they continue to make accurate eligibility determinations and receive appropriate federal funds for covered populations. While total federal funding will be capped, the HAO does not change the need for states to submit claims reflecting actual expenditures to obtain federal matching funds for the Medicaid program. States will also be required to provide quarterly and annual expenditure reports to demonstrate their financial performance relative to their budget agreement.

Flexibilities Available Under the Healthy Adult Opportunity

The HAO will involve the use of section 1115(a)(2) authority to provide coverage to adults not eligible for benefits under the state’s Medicaid state plan, while affording states significant flexibility in the administration of benefits for such individuals. For the first time, CMS is offering flexibilities currently available to states in a comprehensive suite of pre-packaged waiver authorities. This will give states, if they choose it, the opportunity to propose commonly requested authority for participating populations, including the ability to:

• Adjust cost-sharing requirements to incentivize high value care,
• Align benefits more closely to what is available through a commercial insurance benefit package,
• Improve negotiating power to lower drug costs by adopting a closed formulary similar to those provided in the commercial market (see section below for more detail),
• Make timely programmatic adjustments without additional federal approval,
• Apply additional conditions of eligibility which support the objectives of the program,
• Deliver care through innovative delivery systems, and
• Waiving retroactive coverage and hospital presumptive eligibility requirements.

Managed Care and Delivery Systems

CMS encourages states applying for this demonstration to implement evidence-based payment and delivery system reforms in order to achieve compliance with the quality and cost goals. In general, states will be able to use any combination of fee-for-service and managed care delivery systems and will have flexibility to alter these arrangements over the course of the demonstration, as long as certain guidelines are met.

https://www.cms.gov…

CMS Press Release:
https://www.cms.gov…

CMS letter to State Medicaid Directors (56 pages):
https://www.medicaid.gov…

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Comment:

By Don McCanne, M.D.

Conservatives for decades have been trying to change Medicaid funding to block grants – a scheme to progressively reduce federal contributions to the state Medicaid programs. Opponents to block grants have pointed out that the program is already critically underfunded, and further reductions will likely cause states to further reduce coverage for those with the least means to pay for their own care.

Today CMS is introducing the Healthy Adult Opportunity program – a program for adults in poverty who are not otherwise eligible for the state Medicaid programs. CMS has bypassed both Congress and the courts in order to to establish this block grant program, though they do not use that label. But, as the fact sheet explains, “funding will be capped in the aggregate” – a nice way of saying “block grant.”

Since the poor have a very weak political voice, programs for them do tend to be underfunded. By establishing a separate health care program for the poor – Medicaid – chronic underfunding is expected. But that affects not only the poor themselves by impairing access, but it also underfunds those in the health care delivery system who are trying to meet the health care needs of these less fortunate individuals. However, separate funding for health care for the poor is unnecessary. Other nations with universal systems based on social solidarity have no difficulty with the concept of providing equitable care to everyone, regardless of income or wealth.

Rather than having a two-tiered or multi-tiered system, we can ensure that everyone receives optimal care by enacting and implementing a single payer model of an improved Medicare for All. The sooner, the better. In fact, maybe the conservatives could accept the concept of block grants in the form of single payer global budgets, as long as everyone is adequately covered.

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The UK has one of the most equitable health care systems in the world. Here’s how.

By Ezra Klein
Vox, January 28, 2020

The UK spends barely half what we do, covers everyone, rarely lets cost prove a barrier for people seeking care, and boasts health outcomes better than ours.

Which raises the question: How does the UK do it?

“Britain spends a lot less than we do, yet in terms of broad culture, they have a similar value system to our own,” says Hank Aaron, a Brookings Institution health economist and co-author of two books about the British health care system. “Where do they economize? What do they do? How do they ration?”

Decisions of this sort can be made more or less bureaucratically, more or less transparently, and more or less equitably. But the American health care system is uniquely fractured, opaque, and cruel in its approach to saying no. It says no through prices — but not, as in most other countries, by limiting the prices pharmaceutical companies and hospitals can charge for treatments. Rather, it says no by letting them charge whatever prices they want and denying care to those who can’t afford the cost.

The paradox of the American health system, then, is that it poses as a system with no limits — there is no centralized authority rationing care or negotiating treatments — even as it turns tens of millions of people away from services they need. But the system works quite well for those who profit from it, or can afford all that it has to offer, and they can be mobilized powerfully to resist change. When reformers threaten the status quo, the health industry blankets airwaves with ads warning that under the new system, there will be someone who says no to you: the government.

The UK is the opposite of the US in how it says no. It has embraced the idea we fear most: rationing. There is, in the UK, a government agency that decides which treatments are worth covering, and for whom. It is an agency that has even decided, from the government’s perspective, how much a life is worth in hard currency. It has made the UK system uniquely centralized, transparent, and equitable. But it is built on a faith in government, and a political and social solidarity, that is hard to imagine in the US.

A NICE health care system

At the center of the UK system sits the National Health Service. Founded in 1948, the NHS goes beyond single-payer health care into truly socialized medicine: The government doesn’t just pay for services, it also runs hospitals and employs doctors. The system is financed through taxes, everyone is covered, and supplemental private insurance is rare.

In 1999, the British government set up the National Institute for Care Excellence, or NICE, to assess the cost-effectiveness of medications, procedures, and other treatments, and make recommendations to the National Health Service about what to cover and how. NICE has forced the NHS to become the anti-US: Rather than obscuring its judgments and saying no through countless individual acts of price discrimination, NICE makes the system’s values visible, and it says no, or yes, all at once, in full view of the public.

The political economy of rationing

A public health system is only as good as the government that creates, runs, and protects it. Saying no to treatments that people want to get, and that powerful corporations want to release into the market, will generate furious backlash. If the government isn’t trusted enough to win those fights, or if the politicians turn on the civil servants when they pick those fights, the structure collapses.

The late Uwe Reinhardt, the famed health economist who helped set up Taiwan’s single-payer system, once told me that he feared American politics was too captured to properly construct a single-payer system.

“I have not advocated the single-payer model here,” he said, “because our government is too corrupt. Medicare is a large insurance company whose board of directors — Ways and Means and Senate Finance — accept payments from vendors to the company. In the private market, that would get you into trouble.

“When you go to Taiwan or Canada,” he continued, “the kind of lobbying we have [in America] is illegal there. You can’t pay money to influence the party the same way. Therefore, the bureaucrats who run these systems are pretty much insulated from these pressures.”

Health systems need to be built first on a firm political foundation. It would be challenging, to say the least, for an NHS-like system to be designed in the face of the constant legal challenges, repeal efforts, and attempts at political sabotage that have pockmarked the Affordable Care Act.

Aaron, the Brookings economist, argues that the politics of the NHS is rooted in part in Britain’s post-World War II ethic of shared sacrifice. America, particularly at this moment in its political history, lacks such solidarity to fall back on. That, more than anything else, may be the central challenge that any effort to create a national health system in America must face.

It’s not that the political trade-offs of rationing are easy. It’s that, once well-implemented, they come to seem far better, and fairer, than the alternative. “The NHS is seen as a national treasure,” says Carol Propper, a health policy expert at the Imperial College of London. “Elections are fought and won on the basis of NHS funding.”

The most recent UK election is a case in point. One of the keys to Boris Johnson’s huge electoral win was his promise to increase funding for the NHS, which deprived Jeremy Corbyn’s Labour Party of a central issue. Johnson has even said that the NHS, not Brexit, will lead his agenda.

“I frankly urge everyone on either side of what was, after three and a half years, after all an increasingly arid argument, to find closure and to let the healing begin,” Johnson said in his post-election message. “Because I believe — in fact, I know, because I have heard it loud and clear from every corner of the country — that the overwhelming priority of the British people now is that we should focus above all on the NHS.”

This is the irony of comparing health politics in the UK and the US. In part because of the public and fair ways the UK says no, its health system has generated a form of social solidarity that cuts across political lines, that transcends party divisions. In the US, because of the opaque and unfair ways in which the system says no, health care deepens our political divisions, as the system’s current winners fear that reform could make them tomorrow’s losers.

https://www.vox.com…

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Comment:

By Don McCanne, M.D.

Although actual health care delivery is similar in the UK and the US, the financing is starkly different. The UK covers everyone, has better outcomes, and does it at half the cost. The people of the UK rightfully take great pride in their NHS. The way the nations contain costs certainly contributes to these differences.

The US rations through price discrimination in a fragmented financing system that is heavily market-based even if largely publicly funded. It simply makes health care unaffordable for tens of millions of individuals. The UK publicly funds health care and uses the National Institute for Care Excellence (NICE) to set fair prices or to deny coverage for care that does not provide adequate value (see the full article at the link for a discussion of QALY, etc.).

The UK system is thought to be underfunded which results in capacity constraints and thus excessive queues for non-urgent services. Boris Johnson, the head of the newly elected conservative government, acknowledges that “the overwhelming priority of the British people now is that we should focus above all on the NHS.” Because of greater social solidarity in the UK, a conservative is promising that the government will address the problem of queues.

In the US, political polarization, especially over the role of private markets versus the government, has prevented us from using our great financial resources to provide comprehensive health care services to everyone. We are turning our health care dollars over to private payers, especially the private insurance companies, which then use price discrimination to control spending by erecting unnecessary financial barriers to care (premiums, deductibles and other cost sharing). This is particularly ironic when 60 percent of health care dollars pass through our tax system.

Imagine if we had the egalitarianism and social solidarity of the UK. The people there are demanding that attention be paid to their NHS, and the conservative government says that it will do so. Here in the US, the media keep telling us that we are too politically polarized to ever have agreement on the most effective approach to ensuring high quality health care for everyone. But that’s not true. The majority of Americans do support Medicare for All. So why do so many of the conservative and neoliberal politicians continue to oppose it? Are they not listening to the people? And shouldn’t the people respond by demanding that their politicians support an improved Medicare for All?

If conservative Boris Johnson follows through and truly supports the NHS, can’t we move politics in the same direction here?

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By Laura Hawks, M.D.; David U. Himmelstein, M.D.; Steffie Woolhandler, M.D., M.P.H.; David H. Bor, M.D.; Adam Gaffney, M.D., M.P.H.; Danny McCormick, M.D., M.P.H.
JAMA Internal Medicine, January 27, 2020

Key Points

Question: Has unmet need for physician services shifted for US adults between 1998 and 2017?

Findings: Using data from US adults aged 18 to 64 years in 1998 (n = 117 392) and in 2017 (n = 282 378) who responded to the Centers for Disease Control and Prevention Behavioral Risk Factors Surveillance System, this study found that from 1998 to 2017 the inability to see a physician because of cost increased 2.7 percentage points owing to worsening access to care among the insured. In contrast, the proportion of chronically ill adults receiving checkups did not change; results for receiving guideline-recommended preventive services were mixed.

Meaning: Many US adults face substantial and increasing barriers in access to care, despite a modest improvement in insurance coverage in the past 20 years.

Abstract

Importance: Improvements in insurance coverage and access to care have resulted from the Affordable Care Act (ACA). However, a focus on short-term pre- to post-ACA changes may distract attention from longer-term trends in unmet health needs, and the problems that persist.

Objective: To identify changes from 1998 to 2017 in unmet need for physician services among insured and uninsured adults aged 18 to 64 years in the United States.

Design, Setting, and Participants: Survey study using 20 years of data, from January 1, 1998, to December 31, 2017, from the Centers for Disease Control and Prevention Behavioral Risk Factor Surveillance System to identify trends in unmet need for physician and preventive services.

Main Outcomes and Measures: The proportion of persons unable to see a physician when needed owing to cost (in the past year), having no routine checkup for those in whom a routine checkup was likely indicated (within 2 years), or failing to receive clinically indicated preventive services (in the recommended timeframe), overall and among subgroups defined by the presence of chronic illnesses and by self-reported health status. We estimated changes over time using logistic regression controlling for age, sex, race, Census region, employment status, and income.

Results: Among the adults aged 18 to 64 years in 1998 (n = 117 392) and in 2017 (n = 282 378) who responded to the Centers for Disease Control and Prevention Behavioral Risk Factors Surveillance System (mean age was 39.2 [95% CI, 39.0-39.3]; 50.3% were female; 65.9% were white), uninsurance decreased by 2.1 (95% CI, 1.6-2.5) percentage points (from 16.9% to 14.8%). However, the adjusted proportion unable to see a physician owing to cost increased by 2.7 (95% CI, 2.2-3.8) percentage points overall (from 11.4% to 15.7%, unadjusted); by 5.9 (95% CI, 4.1-7.8) percentage points among the uninsured (32.9% to 39.6%, unadjusted) and 3.6 (95% CI, 3.2-4.0) percentage points among the insured (from 7.1% to 11.5%, unadjusted). The adjusted proportion of persons with chronic medical conditions who were unable to see a physician because of cost also increased for most conditions. For example, an increase in the inability to see a physician because of cost for patients with cardiovascular disease was 5.9% (95% CI, 1.7%-10.1%), for patients with elevated cholesterol was 3.5% (95% CI, 2.5%-4.5%), and for patients with binge drinking was 3.1% (95% CI, 2.3%-3.3%). The adjusted proportion of chronically ill adults receiving checkups did not change. While the adjusted share of people receiving guideline-recommended cholesterol tests (16.8% [95% CI, 16.1%-17.4%]) and flu shots (13.2% [95% CI, 12.7%-13.8%]) increased, the proportion of women receiving mammograms decreased (−6.7% [95% CI, −7.8 to −5.5]).

Conclusions and Relevance: Despite coverage gains since 1998, most measures of unmet need for physician services have shown no improvement, and financial access to physician services has decreased.

Introduction

A widely cited study by Ayanian et al highlighted the high prevalence of unmet health needs in 1998, particularly among the uninsured. In the subsequent 2 decades, medical costs have grown exponentially, deductibles and copayments have escalated; Medicaid enrollment has risen sharply; accountable care organizations and pay-for-performance incentives have become commonplace; many private insurers have implemented new cost containment measures and narrowed their provider networks; and, in 2014, a landmark health reform, the Affordable Care Act (ACA), was implemented.

Many analyses have documented the salutary effects of the ACA on coverage, access to care, and disparities in access. However, such analyses may miss the longer-term trends that may affect access to care, eg, the growth of narrow networks, high-deductible plans and higher co-pays that obstruct access to physician services and may compromise health, especially for persons with low incomes. A longer view could help place the achievements of the ACA in the context of these longer-term changes and inform future reform efforts.

We used the same data source as in the 1998 study to explore changes in unmet health care needs among adults aged 18 to 64 years in the past 2 decades.

From the Discussion

Despite short-term gains owing to the ACA, over the past 20 years the proportion of adults aged 18 to 64 years unable to see a physician owing to cost increased, mostly because of an increase among persons with insurance. In 2017, nearly one-fifth of individuals with any chronic condition (diabetes, obesity, or cardiovascular disease) said they were unable to see a physician owing to cost. In contrast, we found improvements in the proportions receiving 2 clinically indicated preventive services, but worsening for another; little change was observed in the proportions who had received checkups in the prior 2 years.

Our finding that financial access to physician care worsened is concerning. Persons with conditions such as diabetes, hypertension, cardiovascular disease and poor health status risk substantial harms if they forego physician care. Financial barriers to care have been associated with increased hospitalizations and worse health outcomes in patients with cardiovascular disease and hypertension, and increased morbidity among patients with diabetes.

Our results provide important context for understanding the consequences of ACA. The implementation of the ACA’s major coverage provisions in 2014 was associated with a 10 percentage point increase in coverage, and improvements in measures of access to care. For example, between 2012 and 2014 the proportion of US individuals who reported skipping care because of costs decreased from 43% to 36%, and the number of persons reporting difficulty paying medical bills decreased by 11 million. Our findings suggest that these substantial short-term improvements were outweighed by longer-term trends toward reduced affordability. Coverage and access rates were decreasing prior to the ACA and improvements from the ACA mostly returned access to levels prevalent in 1998 or left them worse.

The long-term increase in the proportion of uninsured persons reporting they were unable to see a physician because of cost implicates factors unrelated to coverage, eg, decreasing affordability of physician visits relative to income or decreasing availability of safety-net health care. The increase among the insured suggests that increasing copayments and deductibles have decreased the affordability of physician visits for this group.

Our findings are consistent with evidence of growing underinsurance (and resulting problems in access), especially among persons with employer-based plans. Enrollment in a high-deductible health plan, which has become increasingly common in the last decade, a trend uninterrupted by the ACA, is associated with forgoing needed care, especially among those of lower socioeconomic status. Other changes in insurance benefit design, such as imposing tiered copayments and coinsurance obligations, eliminating coverage for some services (eg, eyeglasses), and narrowing provider networks (which can force some patients to go out of network for care) may also have undermined the affordability of care.

The increasing cost of health care creates an access barrier for the insured as well as the uninsured; the RAND Corporation estimated that total expenditures (including premiums, out-of-pocket costs, and taxes on health care) nearly doubled for US consumers between 1999 and 2009, far outpacing inflation. Although many insured adults reported access barriers, the situation remained worse for the uninsured, highlighting the importance of covering the 29 million US individuals who remain uninsured.

The current level of unmet health needs in the US that we found far exceed those of similar countries. Among nations in the Organisation for Economic Co-operation and Development, an average of 9.1% of persons reported skipping health care because of cost in 2017, compared to the 15.7% we found in the US. In Canada, only 1% of adults 45 years old or older with a chronic disease reported a cost-related unmet health need – compared with 18.7% of adults with a chronic medical condition in our US sample. A health care system that offers universal health coverage and eliminates out-of-pocket expenses for patients may be the most practical solution to improving unmet health needs in the US.

Conclusions

Voters’ dissatisfaction with the health care system has spawned a renewal of debate over health reform, suggesting that the ACA’s improvements were insufficient to fully address the health care needs of many US adults. Covering the 29 million who remain uninsured would ameliorate, but not resolve the access to care problems we identified. Additional measures should address the problems in affording care that face many insured US adults. Other nations have achieved universal coverage and substantially reduced cost barriers. Experience in those nations should inform discussion of the additional reforms required to address the unmet health needs of US adults.

https://jamanetwork.com…

An Invited Commentary by John Z. Ayanian, M.D., M.P.P., a co-author of the original article on unmet health needs of the uninsured in 1998, “Looking Back to Improve Access to Health Care Moving Forward”:
https://jamanetwork.com…

An audio interview of lead author Laura Hawks and original paper author John Ayanian (18 minutes):
https://edhub.ama-assn.org…

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Despite insurance gains, more people in the U.S. can’t afford doctors

By Lisa Rapaport
Reuters, January 27, 2020

A growing number of Americans find it too expensive to see doctors even though more people have health insurance, a U.S. study suggests.

Over the past two decades, the proportion of adults without insurance dropped to 14.8% from 16.9%, the study found. But during this same period, the proportion of adults unable to afford doctor visits climbed from 11.4% to 15.7%.

Out-of-pocket costs made doctors too expensive for the uninsured, but costs also kept people with coverage from seeing physicians even when they had chronic medical conditions requiring regular checkups.

“The quality of private health insurance is getting worse, and the cost of healthcare is rising significantly,” said lead study author Dr. Laura Hawks of the Cambridge Health Alliance and Harvard Medical School in Boston.

“We know that private health insurance plans increasing rely on high premiums, high-deductible health plans…high copays and other forms of cost-sharing,” Hawks said by email. “All these create financial barriers.”

https://www.reuters.com…

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Comment:

By Don McCanne, M.D.

This study is of great importance because it shows how well health needs were met in the two decades before and after enactment of the Patient Protection and Affordable Care Act (ACA). Yes, the number of uninsured declined, but “financial access to physician services has decreased.” It is safe to say that the ACA did not do near enough to make health care affordable and accessible for everyone.

Considering the very high costs and the mediocre results of our health care financing system, it is obvious that major changes are required. Yet many politicians and members of the policy community are calling for more of the same – tweaking ACA and adding a Medicare-in-name-only option to the selection of private plans. This will not correct any of the fundamental structural flaws in our health care financing system. Health care will remain unaffordable and inaccessible for far too many, and the rest of us will pay ever higher costs for this highly flawed system.

The single payer model of an improved Medicare for All of course would fix these problems. More Americans are understanding this. Yet too many of our politicians have aligned themselves with the medical-industrial complex, especially the private insurers and pharmaceutical firms. Remember, we do have a democracy and that should allow us to trade in our stale politicians for new ones who understand that government is for all of the people and not just for the plutocrats who think they own Congress. But for us to be heard, our voice to Congress can be no less than a deafening roar.

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By Katherine Grace Carman, Ph.D.; Jodi Liu, Ph.D.; Chapin White, Ph.D.
HSR, Health Services Research, January 27, 2020

What This Study Adds

• Health care financing arrangements are designed to redistribute funds for health care expenditures.
• Higher‐income households pay the most to finance health care in dollar amounts, but the burden of payments as a share of income is greater among lower‐income households.
• We also find significant redistribution across age groups and income groups.

Discussion

Redistribution is at the heart of publicly financed health care and of health insurance. However, health care financing flows are complex. Understanding how different groups contribute to and benefit from health care spending is difficult for researchers and the general public. In this paper, we bring together data to unmask the flow of payments and spending to provide not only a better accounting of burden imposed by the high costs of health care but also to highlight the redistribution inherent in the system.

Much of the burden associated with health care financing is hidden. Those who receive insurance through their employers may not know how much their employer contributes to insurance premiums. Similarly, the tax burden of health care spending is similarly difficult for the general public to observe, as health care is only a portion of government spending.

Similar to previous work in this area, with the exception of Jacobs and Selden, we find that overall health care payments as a share of income are regressive. We find a greater degree of regressivity than found in previous research. This is driven in part by our inclusion of institutionalized populations. We find that including health care spending for institutionalized populations results in a larger burden on individuals in the lowest income quintile. Although the majority of people in the lowest income quintile are not in institutions, for those who are, out‐of‐pocket costs are substantial relative to income. This high cost borne by even on a small proportion of the population considerably increases the regressivity of the health care payments. While for many in this group, the costs may be temporary, being paid only for a short period of time before the individual qualifies for Medicaid, it nevertheless has a large impact on the total payments borne by individuals in the lowest income groups.

Several types of redistribution are built into the financing of health care in America, and indeed into any tax‐financed system or insurance market. First, there is redistribution across phases of life, with working age adults contributing more than older adults, in part because Medicare covers the vast majority of individuals over the age of 65. Second, there is redistribution from the rich to the poor, largely due to the progressive nature of the tax system in the United States. Finally, there is redistribution from the healthy to the sick; this redistribution is fundamentally always a part of health insurance that is designed to protect individuals from the financial shocks associated with illness. Our analysis takes the perspective of a single point in time; however, there may also be implications over the life cycle, as those who have more financial resources tend to live longer, and may not only make greater contributions, but also receive Medicare benefits for a longer period of time.

In order to have evidence‐based, productive discussions of health care reforms and health equity, it is important to have a baseline understanding of the current financing system and the inherent redistribution. Current interest in proposals for health care reform include financing changes that would alter who pays for care, potentially in small ways with incremental changes to the ACA or dramatic ways with expansive reforms such as Medicare for All. If the current patterns of progressivity of tax payments to health care and regressivity of premiums and out‐of‐pocket payments were maintained, moving toward more tax‐financed programs would shift the burden of health care payments from lower‐income to higher‐income households, whereas moving toward more privately paid health care would shift the burden from higher‐income to lower‐income households. A complete picture of the current financing system provides context to understand how these policy changes would impact the overall burden of health care costs, redistribution, and specific segments of the population.

https://onlinelibrary.wiley.com…

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Burden of Health Care Payments Is Greatest Among Americans with the Lowest Incomes

RAND, January 27, 2020

Higher-income American households pay the most to finance the nation’s health care system, but the burden of payments as a share of income is greatest among households with the lowest incomes, according to a new RAND Corporation study.

Households in the bottom fifth of income groups pay an average of 33.9% of their income toward health care, while families in the highest-income group pay 16% of their income toward health care.

The analysis finds that households in the middle three income tiers pay between 19.8% and 23.2% of their income toward health care. The analysis considered all payments made by households to support health care, including taxes and employer contributions.

“Our findings suggest that health care payments in the United States are even more regressive than suggested by earlier research,” said Katherine G. Carman, lead author of the study and a senior economist at RAND, a nonprofit research organization. “As national discussions continue about health reform and health equity, it’s important to understand how the current health care system distributes costs and payments.”

In 2015, health care spending accounted for nearly 18 percent of the U.S. gross domestic product, a measure of the total value of goods produced and services provided by the nation. Ultimately all health care costs are paid by households, either in obvious ways such as through insurance premiums or out-of-pocket costs, in addition to less-visible ways such as employer-paid premiums and taxes.

While out-of-pocket spending, including insurance premiums, is the most obvious payment most people make for health care, the RAND study found it accounted for just 9.1% of health care costs. The vast bulk of health care costs are paid through health insurance premiums and taxes.

The study found that payments to finance health care were $9,393 per person, or 18.7% of average household income.

Examining benefits by type of insurance, researchers found that Americans with Medicare receive the greatest dollar value of health care, a result of older people generally using more health care services.

Those with Medicaid have the largest dollar value of health care received as a percent of income, which corresponds to the lower income and generally poorer health among the group. People with employer-sponsored insurance received the lowest dollar value of health care.

Unsurprisingly, those with lower income are much more likely to benefit from redistribution of health care payments made by others toward health care services.

The study found that households in the three lowest-income groups receive more health care services than they pay for through all forms of payments. In the fourth income group, payments and the dollar value of care received are similar.

Households in the highest of the five income groups are paying much more into the system than they receive in health care services.

https://www.rand.org…

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Comment:

By Don McCanne, M.D.

The United States pays a lot for health care – twice the per capita average of other wealthy nations. Yet we have greater income and wealth inequality which makes it impossible for lower- and even middle-income individuals to pay their proportionate share of health care. So it is no wonder that methods have evolved to redistribute health care payments from the rich to the poor, and from the healthy to the sick. Premiums paid to insurance risk pools plus out-of-pocket expenses tend to be quite regressive, but fortunately some of this is offset by progressive taxes, otherwise lower-income individuals would not be able to afford most health care.

This study confirms the redistribution that is taking place, but it also confirms the regressivity that negatively impacts lower-income individuals. In the HSR article, the authors state, “prior work has considered the burden of health care costs on ‘typical’ families” but “‘typical’ families are surprisingly rare: based on our analyses, only 10 percent of people are part of four‐person households in which all are covered by ESI.”

Thus when policies are designed to cover the relatively rare typical families, a very large segment of our population will fall through the cracks in our fragmented financing system. That partially explains why, in the most expensive health care system on earth, tens of millions still suffer financial hardship and experience financial barriers to care, in spite of the progressive component of health care financing described in this study.

Also health care needs are not evenly distributed throughout the population. In a fragmented financing system that has both progressive and regressive features, the wealthy will continue to fare well, but those with lower incomes are at the mercy of various financing programs, with some faring fairly well but far too many others again facing financial hardship and financial barriers to care.

The authors note, “If the current patterns of progressivity of tax payments to health care and regressivity of premiums and out‐of‐pocket payments were maintained, moving toward more tax‐financed programs would shift the burden of health care payments from lower‐income to higher‐income households, whereas moving toward more privately paid health care would shift the burden from higher‐income to lower‐income households.”

What is the health policy lesson here? We can eliminate deleterious regressive financing by eliminating insurance premiums, including premiums for employer-sponsored plans paid for by wage reductions, and eliminate the regressive out-of-pocket payments of deductibles, copays and other out-of-pocket cost-sharing (i.e., eliminate private insurance). We can enhance beneficial progressive funding of health care by expanding equitable tax-financing of the health care system. That is precisely what the single payer model of an improved Medicare for All is designed to do. What are we waiting for?

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By J. Marc Overhage, M.D., Ph.D. and David McCallie Jr., M.D.
Annals of Internal Medicine, January 14, 2020

Abstract

Background: The amount of time that providers spend using electronic health records (EHRs) to support the care delivery process is a concern for the U.S. health care system. Given the potential effect on patient care and the high costs related to this time, particularly for medical specialists whose work is largely cognitive, these findings warrant more precise documentation of the time physicians invest in these clinically focused EHR functions.

Objective: To describe how much time ambulatory medical subspecialists and primary care physicians across several U.S. care delivery systems spend on various EHR functions.

Design: Descriptive study.

Setting: U.S.-based, adult, nonsurgical, ambulatory practices using the Cerner Millennium EHR.

Participants: 155,000 U.S. physicians.

Measurements: Data were extracted from software log files in the Lights On Network (Cerner) during 2018 that totaled the time spent on each of the 13 clinically focused EHR functions. Averages per encounter by specialty were computed.

Results: This study included data from approximately 100 million patient encounters with about 155 000 physicians from 417 health systems. Physicians spent an average of 16 minutes and 14 seconds per encounter using EHRs, with chart review (33%), documentation (24%), and ordering (17%) functions accounting for most of the time. The distribution of time spent by providers using EHRs varies greatly within specialty. The proportion of time spent on various clinically focused functions was similar across specialties.

Limitations: Variation by health system could not be examined, and all providers used the same software.

Conclusion: The time spent using EHRs to support care delivery constitutes a large portion of the physicians’ day, and wide variation suggests opportunities to optimize systems and processes.

https://annals.org…

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Epic’s CEO is urging hospital customers to oppose rules that would make it easier to share medical info

By Christina Farr
CNBC, January 22, 2020

Key Points

• Epic Systems is urging its health system customers to take a stand against the U.S. Department of Health and Human Services’ proposed rules to make it easier to share patient data.
• Epic’s CEO Judy Faulkner says that patient privacy will be negatively impacted.
• Privately held Epic is one of the leading providers of electronic medical records in the U.S.

https://www.cnbc.com…

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Comment:

By Don McCanne, M.D.

Ambulatory primary care physicians and medical subspecialists spent an average of 16 minutes and 14 seconds per encounter using EHRs, with chart review (33%), documentation (24%), and ordering (17%) functions accounting for most of the time. Those physicians who try to see four patients an hour understand that this does not compute.

In my earlier years of general practice (before I became a charter diplomat in the new field of family practice), only one of our four hospitals existed, and the emergency room was not staffed (we rotated call to cover it from our individual practices). My brother and I each scheduled four patients and averaged about two walk-ins per hour (unavoidable because of the acute nature of our practice – problems that are now usually seen in the emergency room or urgent care centers).

Obviously medical records were a problem. We had to record notes quickly yet adequately. How did we do that? A few years later Lawrence Weed developed the problem oriented medical record. He proselytized on SOAPing the records – recording the organized elements of subjective, objective, assessment, and plans. Intuitively I was already doing that, but without the S,O,A,P designations. It worked very well. It took maybe a minute to record the note, and there was always enough recorded for continuity of care. Also my records were never questioned for lack of adequacy.

So why do we need electronic health records? To make it easier for insurers to deny claims? For entrepreneurial entities to collect and sell data to other enterprises to profit off of patient and provider information? To violate the patients’ privacy? And for what reason?

Even EPIC’s Judy Faulkner says that under HHS rules making it easier to share patient data patient privacy will be negatively impacted. Do we really want to go there?

Surely we can find things to do with 15 of those 16 minutes that will better serve the interests of our patients.

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By Isabel V. Sawhill and Christopher Pulliam
Brookings, January 21, 2020

The state of the American middle class is a hot topic on the campaign trail and in the policy community. As we have shown before, income growth for the middle class, defined as the middle 60 percent of the income distribution, is falling behind both the bottom and the top. Using the Congressional Budget Office’s measure of income after taxes and transfers, which takes into account market income, social insurance, federal taxes, and means-tested transfers, middle-class incomes have grown 47 percent from 1979 to 2016.

That growth pales in comparison to the top and the bottom. The top 20 percent has seen their incomes double. But much more surprisingly, the bottom 20 percent has seen income growth of 84 percent, far outpacing the middle class. Plus, these trends are predicted to continue.

Measuring income is a tricky business. A reasonable critique of this approach is the inclusion of the value of health insurance subsidies, especially for those at the bottom of the income distribution. The value of these insurance subsidies, and therefore the value added to a poor family’s income, has grown faster than other components of income over the past several decades. Some of that additional income bought better healthcare but some did not. More importantly, health insurance can’t be used to pay the rent or buy food, and many if not most of these low-income families would likely value this coverage at less than its high cost. Recognizing the problem, previously, CBO used the “fungible” value of Medicare, Medicaid, and CHIP, which values government insurance to the extent it frees up other income to spend outside of necessities. Then, starting in 2012, CBO began counting the full per capita cost to the government of providing that insurance as income.

This debate about how to count government subsidized health insurance in measures of income has not been fully resolved. Does giving low-income families access to healthcare really increase their income? Some argue yes. If the cost of that access is $7,000, and the family would otherwise have had to buy an insurance policy costing that much, then government provision is worth a lot. Moreover, those are real federal dollars funded by taxpayers and should be counted. Others argue that, in the absence of government provision, most of these families would never buy such an expensive insurance policy for the simple reason that they can’t afford it. They likely value other goods and services more, especially if they are relatively healthy and do not utilize the full value of government insurance.

While we will not solve that debate here, we do want to make a point about the role of healthcare in the CBO numbers. CBO includes three measures of healthcare income: Medicaid and CHIP, Medicare, and employer’s contributions to health insurance. Government subsidies for health insurance make up a large portion of the bottom quintile’s income growth over the past 40 years, largely due to Medicaid and CHIP as mentioned above. Excluding all government and employer health insurance subsidies, the bottom quintile’s income growth drops from 84 percent to 40 percent—a huge decrease.

However, excluding healthcare affects income growth throughout the income distribution. Without healthcare, middle class income growth decreases from 47 percent to 32 percent, a sizable decrease.

Regardless of your view on the healthcare question, income growth for the middle class is still falling behind both the rich and the poor. To be sure, the bottom quintile started from a much lower base in 1979. We are not suggesting that those at the bottom are doing just fine. However, we are arguing that the middle class has not seen strong income growth relative to other groups.

https://www.brookings.edu…

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Comment:

By Don McCanne, M.D.

In the past several decades, the increase in income and wealth due to gains in productivity have accrued primarily to the wealthy, leaving incomes relatively stagnant for four-fifths of our population, even though, as this article indicates, strictly as a percentage the income for the lowest quintile has increased significantly (keeping in mind that a large percentage of a small number is still a very modest amount).

Since health care has become very expensive, and since the government and employer increase in health care subsidies constitutes a form of income, what impact has this had on the inequities of income inequality? If health care subsidies were not included as income, the bottom quintile’s income growth over the past four decades drops from 84 percent to 40 percent, whereas middle class income growth decreases from 47 percent to 32 percent. This suggests that our current health care financing is somewhat progressive, though for the very wealthy, income gains have far more than offset increases health care costs – certainly a regressive trend. Because of the increase in health care costs and the stagnation of incomes for all but the top quintile, the current progressively of health care financing is still inadequate, not to mention that too many are left uninsured or underinsured.

The fact is that America’s working families are stressed because of flat wages and high health care costs. There are many remedies for this that should be implemented, but perhaps the most effective would be to enact single payer Medicare for All in which the universal risk pool is funded through equitable, progressive tax policies. All of us would receive the health care we need and each of us could afford it. In contrast, merely allowing uninsured individuals to purchase Medicare, even if partially subsidized, will have very little overall impact on health care justice. Even worse is to pretend that the market will work for people whose pockets are empty.

Setting aside the problem of financing health care for all of us would allow us to direct our attention to evaluating and implementing other beneficial policies that would bring us closer to the more egalitarian society that we all would like to be a part of (wouldn’t we?).

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By Christopher T. Robertson
STAT, January 20, 2020

Lost in the shuffle of competing plans for saving health care is the radical call by Democratic presidential candidates Bernie Sanders and Elizabeth Warren for “no more copays, no more deductibles” as part of their “Medicare for All” plans.

Doing away with copays and deductibles would represent a complete reversal of U.S. health care policy. In the last decade alone, deductibles have risen 212%, which is about 10 times the rate of inflation or wages. And that’s exactly what federal law has encouraged. The Affordable Care Act capped annual out-of-pocket payments at $16,300 per year, but that is one-quarter of median family income — more than enough to bankrupt a family if illness strikes. When insurance leaves people unprotected against such large costs, it defeats the purpose of having insurance in the first place.

In this way, the Affordable Care Act reinforced this peculiar American policy of making health insurance incomplete — leaving insured individuals to pay substantial costs. This policy reflects a long-ingrained notion of personal responsibility: Nothing is supposed to come for free. This point has seemed about as controversial as the idea that banks should have locks on their doors. To do otherwise, to have a system of altogether “free” (fully insured) health care, would seem imprudent, irresponsible, and wasteful.

There is now a wealth of evidence about how copays and deductibles actually work. And it isn’t pretty.

In the 1970s, scientists fielded a remarkable experiment in which families were actually randomized to have large copays, smaller copays, or no copays. As predicted, those who had to pay some of the costs out of pocket spent less money on health care than those who got “free” care. Yet they seemed to cut back on care indiscriminately, avoiding both low-value care (like antibiotics for a viral infection) and high-value care (like insulin for diabetes). More recent research shows that patients primarily do what their physicians suggest.

Even with copays, patients are rarely able to effectively price shop for health care.

Ultimately, policies with large copays and deductibles do not target wasteful spending with any precision. They just smite those who are unlucky enough to get sick. And they deny access to care for those who cannot afford the payments.

To get real and enduring change, we may have to turn away from substantial copays and deductibles and join the rest of the civilized world with complete health insurance. Rather than trying to get patients to second-guess their own doctors, the law should target the real drivers of wasteful spending — physicians’ conflicting interests, monopolies and market concentration of health care providers, and the lack of investment in rigorous science about what health care is truly valuable.

In this light, it is striking that moderates like Pete Buttigieg and Joe Biden are failing to really grapple with the problem of patient exposure to costs, which polls show is the single most important issue to voters, when they think about health care reform. After all, that is the issue that most directly affects their pocketbooks, at a time when they are most vulnerable and desperate. Nonetheless, the Buttigieg and Biden plans do nothing to address the growing copays and deductibles in employer-sponsored health insurance — the main source of coverage in America.

Sure, Americans may get to keep their insurance under a moderate’s reform plan. But that is the very same insurance that is failing to really secure our access to care and failing to protect us from financial catastrophe when devastating illness strikes.

Christopher T. Robertson, J.D., is professor of law and associate dean for research and innovation at the University of Arizona and author of “Exposed: Why Our Health Insurance is Incomplete and What Can Be Done About It” (Harvard University Press, 2019).

https://www.statnews.com…

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Comment:

By Don McCanne, M.D.

Should a person be automatically exposed to financial penalties merely because of having to face the misfortune of suffering illness or injury, especially when those penalties may impair access to the health care needed, in addition to suffering the insult of financial hardship? Of course not, yet that is precisely what deductibles, copays and other cost sharing of health insurance does.

Yet some say that we need cost sharing to reduce moral hazard – the tendency of individuals to take more risks exposing them to illness or injury if they know that the consequent medical expenses will be covered by others. Really? It’s okay to break a leg as long as the medical costs are covered by insurance? It’s okay to acquire AIDS as long as insurance covers it? It’s okay to suffer the grief and infirmities of obesity (as if that were preventable) as long as mental and physical consequences are covered by insurance? Is threatening a person with cost-sharing financial penalties really a means of ensuring personal responsibility that would prevent behavior that could have medical consequences? Further, is it just to penalize the majority of individuals with illness or injury when their medical misfortunes were not due to a failure of personal responsibility? This last point is the most compelling reason of all to eliminate deductibles, copays, and coinsurance. It’s just not fair.

Professor Robertson refers to “complete” health insurance as that which eliminates substantial copays and deductibles – complete because it replaces today’s incomplete insurance “that is failing to really secure our access to care and failing to protect us from financial catastrophe when devastating illness strikes.”

Time to make our health insurance complete while we bring in everyone and make it affordable for each of us through progressive financing.

PNHP supports policies that improve our health care system for the benefit of all of us, with special attention as to how health care is financed. PNHP, as an organization, does not support any candidates for political office. We advocate for optimal policy, and it is the candidates themselves who select the policies they support.

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