PNHP

Let’s take health care off the bargaining table

Let’s take health care off the bargaining table

By Larry Brown
The Stand, March 5, 2019

Union members enjoy some of the best health care that working-class Americans can expect to receive. Unions have fought long and hard to establish and maintain these benefits and they are justly proud of their achievements. In the absence of a national health plan, they have sacrificed much to negotiate a modicum of security for their members and their families.

More than half of all Americans still access health care through employment-based benefit plans. There is a myth that Americans love their health plans and want to preserve them at all costs. But providing an important public good like health care as a benefit linked to employment rather than as a right available to all is an accident of history. This linkage is not only a bad idea, it is also simply unsustainable.

No other advanced industrialized country links health care to employment like the U.S. does.

Workers in other countries don’t have to fear losing their health care when they lose their jobs, nor are they chained to a job that they hate because they need the health care coverage. They don’t have to worry about their children aging out of their health plans or of losing their benefits as a result of a long-term illness that disrupts their employment. They are not subject to the constant churning of health plans and provider networks and the confusing and ever-changing array of deductibles, co-payments, out-of-network charges that even the best of plans impose on their members.

And importantly, these employer-based health care plans put American companies at a competitive disadvantage against rival businesses in other countries that have national or single-payer health care systems.

The Milliman Medical Index reports that total health care costs for a family of four with decent employer-provided coverage exceed $28,000 per year. This comes to $14 per hour worked by a full-time employee. The average employer pays nearly $16,000 towards those costs and the worker picks up the remaining $12,000 through a combination of payroll deductions, co-pays and deductibles. The total costs have consistently increased 2, 3 and 4 times faster than the rate of inflation. And the percentage paid by the worker has gone up nearly every year since 1994.

That is why health care has become the biggest cause of strikes, lockouts and concession bargaining. Health care costs drive wage stagnation as unions routinely trade off wage increases and other benefits in order to maintain basic health care for their members and retirees. Unscrupulous non-union employers gain an unfair competitive advantage over worker-friendly businesses by shortchanging their own employees’ health care benefits.

Unions do not serve their members well by trying to circle the wagons around an unsustainable model of employment-based health care. That is why the AFL-CIO, the Washington State Labor Council, and dozens of unions have called for a social insurance model like Medicare for All.

The time has come to take health care off the bargaining table by making it a right for all Americans.

Larry Brown is President of the Washington State Labor Council, AFL-CIO. The WSLC is the state’s largest union organization, representing the interests of some 600 locals and councils with approximately 550,000 rank-and-file members working in Washington state.

http://www.thestand.org…

Dr. Adam Gaffney on ‘Washington Journal’

PNHP president Dr. Adam Gaffney appeared on “Washington Journal” on C-SPAN on March 5, 2019. He debated Joseph Antos of the American Enterprise Institute, answered questions from callers, and made the case for a single-payer national health program (i.e. improved Medicare for all) as an affordable, equitable solution to our ongoing health care crisis.

Conflating patient primacy with the patient-as-a-consumer metaphor

Patient-Centered Care, Yes; Patients As Consumers, No

By Michael K. Gusmano, Karen J. Maschke, and Mildred Z. Solomon
Health Affairs, March 2019

Abstract

There are numerous calls for building health care delivery systems that are more patient centered. The focus on patient-centered care has increasingly begun to rely upon, and even merge with, the concept of patients as consumers. Early references to patients as consumers were made by patient advocates who were attempting to challenge professional and corporate dominance in health care. Today, “consumer-driven” health care has become associated with neoliberal efforts to emphasize market factors in health reform and deemphasize government regulation and financing. In our view, a narrow focus on consumerism is conceptually confused and potentially harmful. The consumer metaphor wrongly assumes that health care is a market in the usual understanding of that term, that the high cost of US health care is a function of excessive consumer demand, and that price transparency and competition can deliver on the promise of reducing costs or ensuring quality. Furthermore, a consumer metaphor places disproportionate burdens on patients to reduce health care costs, and it could erode professional obligations to provide appropriate and effective care.

Introduction

Building a health care delivery system that is more patient centered has a lengthy history, including powerful grassroots efforts beginning in the 1960s. These initiatives see patient-centered care as an important means of improving health outcomes and a morally worthy good in itself. As a means to an end, patient-centered care includes efforts to make the care delivery system more efficient and easier for patients to navigate. Patient engagement—a particular form of patient-centered care—yields better, well-documented outcomes by stimulating patients to take on more active roles in promoting and maintaining their health. As a moral end in itself, patient-centered care emphasizes the importance of honoring patients’ values and preferences, and it is less paternalistic and more respectful. Although there are concerns about how the concept might be misapplied, there is broad support for it, evidenced by federal investment in studying how best to ensure patient-centered outcomes and patient-centered outcomes research.

Increasingly, however, the focus on patient-centered care has begun to rely upon, and even merge with, the concept of patients as consumers. In this article we call for greater vigilance in distinguishing patient-centered care from the concept of consumer-driven health care. Too often consumer-driven health care is used as if it were a synonym for patient-centered care. We argue that consumer-driven care is based on critical myths about what creates, and what can rein in, high-cost care. Moreover, the consumer-driven concept can easily place the burden for systemwide cost containment on the shoulders of individual patients. In this article we offer a brief history of the patient-centered care movement, demonstrate how the language of patient-centeredness is becoming appropriated by those advocating market reforms, and then articulate why the consumer metaphor is misguided and potentially harmful.

Origins of the Patient-Centered Care Movement

In contrast to the early use of these terms to connote ways of empowering patients, consumer driven and consumerism are now associated with market-oriented health reforms that place a burden on patients to solve cost and quality problems. These consumer terms function as metaphors that represent conceptual confusion and are potentially harmful. The terms wrongly assume that health care is a competitive market and that the high cost of US health care is a function of excessive consumer demand. Because these requisite assumptions are not met, the metaphor’s remedy—price transparency and competition—cannot deliver on the promise of reducing costs or ensuring quality. Moreover, it is misleading to use consumer driven, defined in this narrow sense, as a synonym for patient centered. A consumer metaphor could also erode obligations by policy makers and health care systems to build a truly patient-centered care system.

Health Care Is Not a Market

Patients can be construed as consumers only if they are operating within a market. But health care is not a market in the usual way that markets are defined, and thus patients do not have the power that consumers have to shape that market. Patients are not as well informed as physicians are about medical care. Often patients do not have well-formed preferences, and they seek care under circumstances in which they do not have the time or emotional stamina to shop around on the basis of quality and price. And if policy makers treat health care like any other market, there will likely be very limited cost savings, if any, and huge inequities will continue and likely increase. As Nancy Tomes puts it, “this linguistic transformation has come to represent the worst consequences of American medicine’s growing market orientation.

The High Cost of US Health Care Is Not Due To Excessive Consumer Demand

Policy makers in the US frequently act as if the main problem is excess volume, which in turn arises from excess patient demand. Because most patients in the US have some form of health insurance, they are insulated from the full cost of health care. Some commentators are concerned that there is a potential moral hazard, because insurance provides patients with an incentive to consume health care beyond the point at which marginal benefit equals marginal cost.

More than just a technical term, moral hazard is a concept that is normatively loaded. It suggests that health care spending is the result of policies that offer an incentive for bad behavior.

Moral hazard concerns suggest that the use of expensive hospitalizations, surgeries, and other interventions are shaped primarily by ability to pay. This perspective fails to recognize that most people consume such services only reluctantly. The use of these services is often driven by providers, not by patients. Indeed, academics and policy makers have expressed concern for decades about the reliance of the health insurance system on fee-for-service payments to physicians, hospitals, and other health care providers. Fee-for-service provides an incentive for physicians to deliver additional and more complex services than patients need (or more care than economists would view as efficient) because health care providers receive an additional payment for every additional service—and services that are viewed as more technically complex generate higher fees. In most countries outside the US, however, “provider-driven” demand is not countered by shifting costs to individual patients and asking them to control costs by acting as informed consumers in a marketplace. Instead, most countries rely on a combination of overall budget targets for health care services and systems of all-payer rate regulation in which national health insurance funds negotiate rates for hospital, physician, and other services with representatives from those professions. Because the US does not use the negotiating power of government to confront the power of providers, it pays higher prices for all medical goods and services than other countries do.

Not only is the use of market competition limited when it comes to asking patients to make efficient decisions about health care services and providers, but it also does not work well when it comes to making decisions about health insurance plans. Competition among health plans in the Medicare program was promoted as a method for reducing the costs of the program, but Medicare Advantage has not produced the intended savings. In fact, there has been some examination of choices made in Medicare Part D, suggesting that consumers do not necessarily make choices in their own best interests: Beneficiaries fail to select plans that provide better risk protection at lower cost. These findings are consistent with earlier work on choice overload and Medicare beneficiaries’ selection of health plans. The findings led economist Paul Krugman to exclaim that “‘consumer-based’ medicine has been a bust everywhere it has been tried.

While it is wise to help patients make more informed decisions about the costs of care and to grow in their ability to make quality comparisons across health systems, the main driver of health care costs is not consumer demand, but rather the introduction of new technologies and unwillingness on the part of US political leaders to regulate prices—or at least use government bargaining power as leverage to negotiate lower prices. The US relies on a system of uncoordinated payment by thousands of payers, many of which do not have the bargaining power necessary to drive down prices. This has resulted in high prices for medical services. Technological improvements in health care have driven increases in cost all over the world, but extraordinarily high prices and a refusal by government to regulate them or bargain them lower differentiate the US from other countries.

The Consumer Metaphor Could Erode Health Care Professionalism

Medical professionalism requires independent, discretionary judgment. Professionals do not simply do as they are told or requested but must act on the basis of knowledge, skill, and fiduciary obligations to patients’ well-being.

Hospitals must judge each case to find the right balance between patient and family preference and physician integrity. It seems reasonable to anticipate that as the consumer metaphor grows, physicians’ authority in these kinds of cases could erode to the point where they may become technicians doing what they are asked to do, but doing so against their own consciences.

Professionalism may also erode if physicians are more inclined to offer unproven treatments simply because patients demand them. If the customer is always right, self-restraint on the part of providers could erode.

Conclusion

After four decades of organized patient advocacy, US patients are still struggling to influence the health care decisions and policies that shape their lives. Conflating consumer approaches with authentically patient-centered approaches will exacerbate this gap. In health care delivery and health policy, a patient-centered approach affirms the ethical principles of respect for persons and justice while striving to make the health system more responsive to patients’ values and preferences. There are some patient-centered approaches, such as patient engagement and activation, that yield substantial improvements in health outcomes. Pursuing the sensible goal of creating a patient-centered health system will be undermined if consumer metaphors prevail. It is important for policy makers and health system leaders to be vigilant in distinguishing between these seemingly similar, but different, approaches. Patient-centered approaches aim to ensure clinical care that can meet patients’ preferences and needs. That is different from a consumer orientation calling on patients to be prudent purchasers of medical care services. The former approach empowers patients. The latter expects patients to solve society’s cost-containment challenges.

https://www.healthaffairs.org…

Comment:

By Don McCanne, M.D.

The authors are from the Hastings Center, a nonprofit bioethics research institute in New York. That is important to understand since the consumer-driven movement in health care has left out this one crucial element: ethics.

Advocates of consumer-driven health care have conflated the primacy of the patient with the patient-as-a-consumer metaphor, but the two have very little in common.

A discussion of this issue is very timely since legislation to enact a single payer Medicare for All program has been introduced in Congress. Elimination of financial barriers to care (deductibles and other cost sharing) is a fundamental feature of this model of reform. Consumer-driven models deliberately erect financial barriers to care in order to deter the use of health care services and thus reduce health care spending, but it does so at the cost of impairing access to beneficial health care services and potentially exposing patients to financial hardship. In sharp contrast, a well designed single payer model uses much more patient-friendly methods of controlling spending. Specifically, costs are contained through publicly-administered negotiated pricing and global budgeting. Pricing is high enough to ensure adequate capacity in the system yet not excessive, thereby ensuring that health care will be available and affordable for society as a whole.

As the authors conclude, we should not expect patients to solve society’s cost-containment challenges. “Pursuing the sensible goal of creating a patient-centered health system will be undermined if consumer metaphors prevail.” Thus it is an ethical imperative to reject consumer-driven health care and move forward with an equitable, affordable system that ensures essential health care for everyone – Single Payer Medicare for All.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

Is Single-Payer Health Care a Pipe Dream?

By Elizabeth R. Rosenthal, M.D.
New York Times, Letters, March 5, 2019

To the Editor:

In the near future Medicare for all will join the heap of other impossible dreams that came true: women’s suffrage, Social Security, Medicare, integration and gay marriage.

All we need are bold leaders with imagination and a strong grass-roots movement to support them. They are on their way!

Dr. Rosenthal, a retired dermatologist, is on the board of Physicians for a National Health Program-NY Metro Chapter.

https://www.nytimes.com…

PNHP’s Adam Gaffney educates Fox Business panel

U.S. should transition to single-payer health care system: Dr. Adam Gaffney

Fox Business, March 1, 2019

Physicians for a National Health Program President Dr. Adam Gaffney discusses why the U.S. should move to single-payer health care system.

Nine minute Fox video:
https://video.foxbusiness.com…

Comment:

By Don McCanne, M.D.

Considering that most of the Fox panel members were more intent on providing their own right-wing messages against single payer health care, PNHP President Adam Gaffney is quite effective in giving quick, succinct responses on Medicare for All even as he has to override the squawking Fox magpies as they try to disrupt him.

Great job, Adam.

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

Dr. Adam Gaffney on ‘Bulls & Bears’

PNHP president Dr. Adam Gaffney appeared on “Bulls & Bears” on Fox Business on March 1, 2019. He shared the stage with five single-payer skeptics and pushed back against the myths, anecdotes, and distortions they trotted out in order to make the case for improved Medicare for all.

Medicare for All Explained Podcast: Episode 7

Interview with Dr. George Bohmfalk

March 1, 2019

Dr. Bohmfalk details the history of fire departments and suggests that, if we can move from exploitative private entities to public entities that serve the common good, then we can do the same in health care. Hosted by Joseph Sparks. Additional episodes will be uploaded twice monthly. Subscribe in iTunes, or access a complete archive of the podcast, below.

https://medicareforallexplained.podbean.com

Dianne Feinstein’s inadvertent political lesson for Nancy Pelosi

Nancy Pelosi: The Rolling Stone Interview

By Tessa Stuart and Jann S. Wenner
Rolling Stone, February 27, 2019

Rolling Stone: There’s a lot of debate on the question of single-payer, Medicare for All — we’ve heard that expression just recently. What do you think should be done? Where do you want this to go?

Nancy Pelosi: This is a very interesting debate, and in any debate, as I start off this conversation, you must define your terms. Let’s stipulate to some facts here: When we passed the Affordable Care Act, for us, it was a pillar of health and economic security for America’s working families — 125 million families got better benefits, more reasonably priced, with no annual or lifetime caps, and with no prohibition if you had pre-existing consumer protections. We were on a good path, and when [Republicans] took over [Congress], they let certain things expire. People say, “Well, it’s not doing this or that.” Well, it did until it expired. Restore the reinsurance. Elect more Democratic governors so that Medicaid can be expanded and millions more people can have access in an affordable way. I myself wanted to have the public option. We couldn’t get that through the Senate, but we enabled states to do a public option if they want. This made as drastic a difference as day and night. Now, of course, everyone isn’t covered because in certain states they didn’t expand Medicaid, so now [people are proposing] Medicare for All.

When they say Medicare for All, people have to understand this: Medicare for All is not as good a benefit as the Affordable Care Act. It doesn’t have catastrophic [coverage] — you have to go buy it. It doesn’t have dental. It’s not as good as the plans that you can buy under the Affordable Care Act. So I say to them, come in with your ideas, but understand that we’re either gonna have to improve Medicare — for all, including seniors — or else people are not gonna get what they think they’re gonna get. And by the way, how’s it gonna be paid for?

Now, single-payer is a different thing. People use the terms interchangeably. Sometimes it could be the same thing, but it’s not always. Single-payer is just about who pays. It’s not about what the benefits are. That is, administratively, the simplest thing to do, but to convert to it? Thirty trillion dollars. Now, how do you pay for that?

So I said, “Look, just put them all on the table, and let’s have the discussion, and let people see what it is. But know what it is that you’re talking about.” All I want is the goal of every American having access to health care. You don’t get there by dismantling the Affordable Care Act. As Californians have said to me, “We get billions and billions of dollars out of the Affordable Care Act coming into California. Now they want to get rid of that.” How are they gonna go to single-payer in California without the money from the Affordable Care Act? Anyway, this is not a bumper-sticker war — this is a complicated issue.

https://www.rollingstone.com…

The Viral Confrontation with Dianne Feinstein Had a Political Impact Most Pundits Missed

By Aida Chavez and Ryan Grim
The Intercept, March 1, 2019

There is Twitter, and there is the real world. Occasionally, the two meet.

It happened over the last week, starting with a visit by a group of children and young activists with the Sunrise Movement to Sen. Dianne Feinstein’s Bay Area office last Friday. Their exchange — about whether the California senator would vote for or co-sponsor the Green New Deal resolution authored by Rep. Alexandria Ocasio-Cortez, D-N.Y., and Sen. Ed Markey, D-Mass. — went viral. It led to a turbocharged debate about whether the video had been edited, but it also brought with it a tangible change in the halls of Congress.

In her now-infamous response to the Sunrise activists, Feinstein said she was in the process of drafting her own, more moderate resolution on confronting climate change that she felt would have a better chance of passing in the GOP-run Senate. The viral Twitter clip, which has racked up more than 9 million views, was the first time many people had heard of Feinstein’s alternative resolution, and when climate activists learned about it, they went into overdrive to stop it. Feinstein, facing pressure, this week elected to shelve it.

The senator’s reversal was one of several moments that has gone unnoticed in the fight for the Green New Deal, as young activists face skepticism from entrenched environmental groups and field regular criticism for their practice of protesting Democrats. What those critics miss is that it was a protest of a Democrat — then-prospective House Speaker Nancy Pelosi — that put the Green New Deal on the map, and now a second action against a Democrat has yielded a second success for the activists.

On Tuesday, the Sunrise Movement led a nationwide day of action, holding office visits, rallies, and office takeovers across 34 states to pressure lawmakers from both parties, including Senate Majority Leader Mitch McConnell, R-Ky., to support Ocasio-Cortez and Markey’s resolution. That their conversations with Democrats have borne more fruit should be instructive as they try to gin up more support the Green New Deal.

When hoping to stop a bold piece of legislation that has broad public support, one of the oldest moves on the Senate floor is to introduce a different version that is claimed to be just as good, but more reasonable. “I’ve been in the Senate for a quarter of a century, and I know what can pass, and I know what can’t pass,” Feinstein said last week.

On Monday, the Sunrise Movement, in the form of roughly 250 Kentucky high schoolers, occupied McConnell’s Senate office, resulting in 35 arrests.

While the sit-in got little attention in the press, it appeared to have gotten McConnell’s. The majority leader, who is up for re-election in 2020, had recently been eager to put the Green New Deal on the Senate floor. All of a sudden, however, he suggested that it would come up at some point before the August recess.

“This wouldn’t have happened without thousands of people across the country pressuring senators of both parties. Two weeks ago, McConnell was excitedly telling the media about his plans. Now, he seems happy to let this vote be forgotten,” said Varshini Prakash, executive director of Sunrise.

https://theintercept.com…

Comment:

By Don McCanne, M.D.

Considerable enthusiasm has been generated amongst single payer Medicare for All supporters with the introduction of Pramila Jayapal’s H.R. 1384 – The Medicare for All Act of 2019. As expected, the opponents are coming out of the woodwork. Perhaps most disappointing have been the responses of those who would prefer to continue to support the Affordable Care Act and add a public option – a Medicare buy-in for some.

In an effort supposedly to keep the Democratic coalition together, Nancy Pelosi and other Democratic leaders are attempting to suppress the Jayapal bill using the rhetoric of the Republicans – “How’s it gonna be paid for?” – knowing that it could not pass in this session of Congress anyway with Republican control of the Senate and The White House. To protect the moderate Democrats in red districts they are advocating for legislative proposals that would support the current, highly deficient system. In so doing they are passing up a tremendous opportunity to educate not only the public at large but also their colleagues in Congress.

Nancy Pelosi and Dianne Feinstein are two seasoned California politicians who believe they have mastered the political process (and, in many ways, they have). But witness Feinstein’s incident that shows that it is never too late to learn new lessons. (As an octogenarian physician/policy analyst, I’m still learning new lessons every day).

Feinstein met with a group of primary and secondary level students who enthusiastically presented her with cogent arguments in support of the Ocasio-Cortez/Markey Green New Deal resolution. In a video that went viral, Feinstein blundered through a surprisingly somewhat rude response and then presented the students with her own pablum version of a green resolution. It did not take her long to realize that her response fell far short of that of a master politician, and so she elected to shelve her resolution. This proved to be a teachable moment for Dianne Feinstein. She may not endorse the Green New Deal, but at least she has more respect for it and for its supporters. The students had something important to say, and much of the world agreed with them, thanks to the viral distribution of their message.

We are seeing a similar process in the House of Representatives right now. The Jayapal bill is precisely the reform we need for our overpriced and underperforming health care system – a system so large that it is approaching one-fifth of our economy. And yet several members of Congress are producing pablum bills to displace the legislation that we need, and Nancy Pelosi is supporting them. As she says, “All I want is the goal of every American having access to health care. You don’t get there by dismantling the Affordable Care Act.” Further she says, “When they say Medicare for All, people have to understand this: Medicare for All is not as good a benefit as the Affordable Care Act.” Has she been practicing composing Trumpisms? The Jayapal Medicare for All Act is vastly superior to ACA – absolutely no contest!

The Green New Deal will not pass in this session of Congress. Neither will the Medicare for All Act of 2019. But we cannot replace these concepts with pablum and walk away. We need to take a lesson from the children who confronted Dianne Feinstein and stand up for the cause. Health security and even our lives are dependent on it. Fight for single payer Medicare for All and reject emasculated substitute measures that would have hardly even a nominal impact on the problems before us.

Activism! Now! Fight unrelentingly for H.R.1384!

Stay informed! Visit www.pnhp.org/qotd to sign up for daily email updates.

The Medicare for All bill is a winner

By Jeffrey Sachs
CNN, March 1, 2019

Rep. Pramila Jayapal introduced a sweeping Medicare for All (MFA) bill on Wednesday (H.R. 1384), and the national debate on healthcare is bound to intensify through the 2020 election. Voters rank healthcare costs as their second most important priority, just after the economy. The political fate of MFA will likely depend on one key question: Will it reduce healthcare costs while preserving the freedom to choose health providers?

If properly structured, MFA can do that: cut costs while improving choice.

Medicare for All has come a long way since Sen. Bernie Sanders launched his 2016 presidential campaign on that theme, while fellow Democrats ran from the label. Sanders also faced the wrath of mainstream pundits like Paul Krugman, who described Sanders’ healthcare plan as “smoke and mirrors.” Now, every major Democratic Party candidate endorses the label, (though they will certainly differ on the details) and Sanders could well become president in 2021 on the basis of his clear and persistent MFA advocacy.

No doubt the debate will become heated, even shrill. We are talking about serious money, and the largest single sector of the American economy. Healthcare outlays in the United States account for nearly 18% of the country’s gross domestic product. Profits are soaring in the private healthcare and pharmaceutical industries, both of which will fight fiercely against MFA. President Donald Trump has weighed in, declaring that Democrats are “radical socialists who want to model America’s economy after Venezuela.”

While former President Barack Obama spoke out in favor of a single-payer plan, he avoided the battle back in 2009 with the Affordable Care Act. And by making health insurance available to millions more Americans, the Affordable Care Act allowed private industry to raise prices given the increase in demand. The result is that Obamacare expanded overall coverage, and provided hugely popular guaranteed coverage for pre-existing conditions, while avoiding any decisive steps on cost containment.

MFA picks up at that point. Real cost containment will be the critical issue that either makes or breaks each MFA proposal.

Americans currently pay around $10,000 per person per year in health outlays, compared with roughly half that amount in other high-income countries such as Canada, Japan, the Netherlands, or Sweden. The reasons have been debated and studied in detail. Do Americans use more and better healthcare and therefore also pay more? Alas, no. Americans use roughly the same or less healthcare, but pay far more for health services including drugs, hospital stays, and medical procedures such as an MRI.

The Canada comparison

A comparison of healthcare costs between the US and 10 other high-income countries allows a detailed comparison of the US and Canada, the most relevant peer country. According to the comparative data, the US spends 17.8% of GDP compared with Canada’s 10.3%, amounting to $9,403 per person in the US compared with Canada’s $4,641.

All Canadians are covered by the healthcare system, while 10% of Americans lack public or private insurance coverage. Total pharmaceutical spending per person per year averages a whopping $1,443 in the US, compared with $613 in Canada.

For example, the cholesterol drug Crestor is $86 per month in the US, and $32 in Canada; the arthritis drug Humira is $2,505 in the US, compared with $1,164 in Canada. Yet despite the much higher health spending per person, life expectancy in the US is 78.8 years, while in Canada it is 81.7 years.

The article reaches the following conclusion: “The United States spent approximately twice as much as other high-income countries on medical care, yet utilization rates in the United States were largely similar to those in other nations. Prices of labor and goods, including pharmaceuticals, and administrative costs appeared to be the major drivers of the difference in overall cost between the United States and other high-income countries.”

Huge private costs in the US

US private health insurance costs are out of sight. A typical US family of four covered by employer-based health insurance pays, in total, around $28,000 per year, taking into account the insurance premium paid for by the employer out of the worker’s total compensation, the premium paid directly by the household, and all of the extra costs, including deductibles, co-payments, and out-of-network payments. The cost of healthcare is crippling working-class families, which may explain why it is at the top of the political agenda.

What is the reason for these extraordinary costs in the US? Astronomical administrative costs, for one, are the result of countless and conflicting payments systems facing almost any patient who visits the doctor’s office or hospital. One study in 2014 suggested that America’s extraordinarily complicated multi-payer system leads to administrative costs for billing and insurance that are five times the costs of a simplified payment system such as Canada’s.

The second is the soaring monopoly profits and sky-high salaries along the entire private supply chain, from drug manufacturers to hospitals. The drug companies use their extraordinary monopoly power, whether due to patents or FDA approvals on out-of-patent drugs, to overcharge Americans with markups that are sometimes hundreds of times the production cost of the medicines. And private providers are a highly concentrated industry in most metropolitan areas.

With the mergers and closures of hospitals during the past 20 years, driven by for-profit medicine, this market power has soared, and so too have monopoly profits and healthcare costs facing consumers.

Check out the CEO compensation of the big systems providers — $59 million for Aetna, and $44 million for Cigna in 2017 — or the salaries of the executives of the “not-for-profit” hospitals in your area, often running several million dollars per year.

For these reasons, healthcare costs in the US could be brought down by cutting three main areas: administrative costs, drug prices, and monopoly profits of private insurers, which in turn could be achieved by much lower reimbursement rates for medical services and more effective contracting. Recent studies (here and here) have shown prospective savings on national health expenditures resulting from Medicare for All would save trillions of dollars over 10 years.

Smart cost control

The Jayapal bill is smart on cost control. It would have Medicare negotiate with pharmaceutical companies to drive drug prices down, with the threat of removing the monopoly rights of patents if the drug company doesn’t reach a reasonable agreement on prices. (Technically, the government would issue a compulsory license to competitors). It would have Medicare set an annual budget with hospital providers. This annual budget would focus on healthcare provision rather than wasted time and expenses on billing. It would not permit astronomical management salaries and super-profits.

By wringing massive administrative costs, monopoly profits, and sky-high salaries out of the healthcare system, costs would be slashed, with the savings passed on to households. Remember, if the US paid the same share of income as our peer countries like Canada, the total saving would be on the order of 6% of GDP (from 18% today to around 10-12% as in the peer countries). With a GDP of around $62,000 per person in the US, 6% of GDP saving comes to a cost saving of around $3,700 per person, or around $14,800 for a family of four.

Such savings wouldn’t be achieved in full, or even in the early years. The pushback from industry against cost-cutting will be fierce. Moreover, the sheer inertia of existing costs, prices, budgets, and administrative systems cannot be doubted. But what can be said with confidence is that a well-designed MFA system would put the US on a path toward the reasonably priced healthcare systems of other comparable countries.

Moreover, MFA would allow us to rethink healthcare delivery to take into account perhaps the biggest feasible benefit in health outcomes. America’s current disease burdens often reflect unhealthy life circumstances — great stress, obesity-inducing diets, lack of exercise, drug dependence, and others. These are social ills turning into medical ills.

A fairer, more balanced, health system based on good health rather than maximum profits would turn its attention to helping Americans live healthier lives.

Getting MFA through the political process won’t be easy. The drug industry is one of America’s top lobbies and campaign contributors, befitting a massive economic sector rolling in profits. Lobbying outlays in 2018 across the health sector are estimated at around $549 million and campaign funding in the 2018 election cycle at $255 million. The industry will be ready to fight an MFA plan with guns blazing, and trot out the usual arguments: stop socialized medicine, save personal choice, don’t put yourself into the hands of government bureaucrats, don’t let American become Venezuela — you name it.

Yet Sanders and Jayapal and their many colleagues who have come on board now (including 106 co-sponsors) have the best chance to prevail in our modern history. Americans know that the healthcare system is rigged, and they will support a new system that convincingly shows the way to fair and reasonable healthcare costs.

Jeffrey Sachs is a professor and director of the Center for Sustainable Development at Columbia University.

https://www.cnn.com…

The special interests behind the Medicare for All bill

The Special Interests Behind Rep. Pramila Jayapal's Medicare for All Bill Are Not the Usual Suspects

By Ryan Grim
The Intercept, February 27, 2019

The Medicare for All legislation unveiled Wednesday by Rep. Pramila Jayapal, a Democrat from Washington state, was written with the help of a broad swath of lobbyists and special interest groups, if perhaps not the kind associated with typical health policy legislation on Capitol Hill.

The key outside groups involved in the drafting included nurses, doctors, disability rights activists, and advocates for the elderly, as well as public interest organizations such as Public Citizen and the Center for Popular Democracy.

Along with Consortium for Citizens with Disabilities, the main groups involved in drafting the legislation were National Nurses United, a major nurses union that has long been on the forefront of the fight for single payer; Physicians for a National Health Program; the Center for Popular Democracy, which organizes poor and marginalized communities; Public Citizen; and Social Security Works, which represents more than a million progressive seniors who support expanding the Medicare coverage they have to the rest of the population.

Meanwhile, the insurance and pharmaceutical industries played little to no role in the drafting process — an anomaly on Capitol Hill. Their marginalization in the process represents a major departure from the approach taken with the Affordable Care Act and reflects the type of bill being drafted: one less concerned about the profits, or even survival, of interest groups like insurers and more concerned with delivering care to the largest amount of people in the most cost-effective way.

Noticeably absent from the central drafting room was the Center for American Progress, the leading center-left think tank, which reflects a reticence by many in the progressive policy community to embrace something as sweeping as Medicare for All. The Center for American Progress, instead, has pushed what it calls “Medicare Extra for All,“ an expanded version of a public option that people could buy into.

https://theintercept.com…

Comment:

By Don McCanne, M.D.

Special interests yes, when that interest is for the all of the people and their health, but we need to keep out the “usual suspects.”

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There’s A New ‘Medicare-For-All’ Bill In The House. Why Does It Matter?

By Shefali Luthra
Kaiser Health News, February 27, 2019

Members of the House on Wednesday offered their version of a “Medicare-for-all” bill that is broader than what’s been put forth by Sen. Bernie Sanders (I-Vt.), whose 2016 presidential run pushed the issue into the political mainstream.

Rep. Pramila Jayapal (D-Wash.) and Rep. Debbie Dingell (D-Mich.) unveiled the “Medicare for All Act of 2019,” which redefines what the change in health care coverage might mean. The specifics included in the bill could play a role in the upcoming Democratic presidential primary campaign because candidates seeking support from the party’s progressive wing leverage the phrase. But often, they use it to mean various things.

Is this bill so different from Medicare-for-all proposals that have come before? And why would those differences matter? Here are the essential takeaways:

In terms of the policy 411, the Jayapal-Dingell bill includes provisions not in other proposals.

In many ways, the proposal sounds familiar: The government would establish a health plan that pays for basically all forms of medical care for all citizens. That’s how it gets the moniker “Medicare-for-all.”

Under this plan, patients would not be responsible for any cost sharing of medical expenses, and the government coverage would include hospitals, doctors, preventive care, prescription meds and dental and vision care. Private insurers would not be allowed to sell plans that compete with the government program.

Senior citizens would be folded into the new Medicare plan, which would be more generous than their current coverage, and the government would make sure any medical care they are getting is not disrupted. The bill leaves two other government health care payers intact: the Veterans Health Administration and the Indian Health Service. Beneficiaries enrolled in these programs would have a choice of enrolling in the new Medicare-for-all plan or sticking with their current coverage.

Just like the Sanders bill, the House legislation covers what it calls “comprehensive reproductive health.” Backers say it is meant to cover abortion — a controversial provision. Right now, government-funded health plans are legally prohibited from providing funds for abortions.

There are differences, too. For one, the transition to the new Medicare-for-all system would take place over two years, which would be a fast turnaround for a substantial task. Sanders’ bill suggested a four-year transition.

The biggest difference: This House vision of Medicare-for-all would also cover long-term care. That isn’t part of the Sanders bill, and it is not covered by Medicare. But for people with disabilities and the elderly, it’s a significant benefit — and one that can get very expensive to pay for out-of-pocket. (The Affordable Care Act included a long-term care provision that was eventually scrapped because of its high cost.)

The House bill also would take a swipe at high prices for prescription drugs by empowering the government to negotiate prices directly with manufacturers and to take away and reissue drug patents if such efforts faltered. This idea, known as “compulsory licensing,” has appeared in drug-pricing bills, but not in other Medicare-for-all legislation.

And the bill wades into one of the hottest Medicare-for-all controversies: the role of private health care. Notably, it permits it. Private plans can cover services not included in the single government health plan. Doctors can also refuse to participate in the program and charge patients cash for medical treatment instead.

“Whether there’s someone out in Beverly Hills who sees the stars and doesn’t partake — that would be possible,” said Dr. Adam Gaffney, a doctor and president of Physicians for a National Health Program, a single-payer advocacy group that supports the legislation. “The way the whole program is structured is to really make it such that that’s a very insignificant overall phenomenon.”

And the legislation takes on wonkier questions, like health care costs — proposing so-called global budgets that set a firm amount the federal government would pay for hospitals, for instance, as a strategy to bring down spending.

Still, the legislation leaves a lot of meaningful details open to interpretation.

Three big ones: what precisely would be covered, what doctors would be paid and how the program would be financed.

Generally, Medicare-for-all would provide “comprehensive benefits,” accounting for health care needs as “medically necessary or appropriate.” That means covering hospital and doctor visits, but also, for instance, mental health, maternity services, addiction treatment, pediatrics and medications.

Where it gets tricky is determining which specific services qualify as “necessary.” Sometimes that’s obvious — insulin for diabetics or a cast for a broken leg.

In other cases, it’s not as clear. Examples include politically controversial treatments, like gender confirmation surgery. Many experts do say the procedure is an important option for people with gender dysphoria. But specific components of it are sometimes deemed cosmetic or unneeded — often by those skeptical of the treatment to begin with.

There are also reconstructive surgeries that provide medical value, but may be deemed cosmetic.

The Department of Health and Human Services would have significant discretion in interpreting what specific services are “medically necessary.” That means political leanings or scientific debates could sway what’s covered, even from administration to administration.

“Reasonable people could disagree on certain things,” Gaffney acknowledged.

The legislation also spells out steps for determining how to pay doctors — a tricky issue, since doctors often complain that traditional Medicare pays them less than does private insurance. But the bill doesn’t set up a reimbursement system.

Of course, there’s the question of how the U.S. pays for the new program. Studies suggest Medicare-for-all would bring down national health care costs. Currently, though, much of that health spending is borne by the private sector. Under the Jayapal-Dingell bill, the money would have to come out of taxpayer dollars.

That would mean new taxes, and that’s a subject that does not appear anywhere in the Jayapal-Dingell bill. (Jayapal has said she will put out a separate list of potential taxes that could finance her single-payer proposal. Sanders also used this strategy — a separate list of “pay-fors” — to make a case for his bill.)

The bill could resonate throughout the 2020 campaign.

The House bill keeps a spotlight on the Medicare-for-all issue — requiring Democratic presidential primary candidates to answer more questions and spell out stances on this particular policy.

That could create some land mines. Medicare-for-all is controversial, and already major health industry groups have ramped up opposition to the broad idea. This bill’s specific provisions, such as its coverage of abortion, would add more adversaries. Its long-term care coverage would further drive up its multitrillion-dollar price tag

But Robert Blendon, a health care pollster at the Harvard T.H. Chan School of Public Health, pointed out that addressing concerns such as the long-term care benefit could add to the measure’s political muscle. It could make the idea more attractive to older voters, who otherwise might be hesitant to change their coverage but who do turn out disproportionately to vote in primaries.

That dynamic, he said, could skew primary results to favor candidates who endorse Medicare-for-all, as opposed to more moderate Democrats who have distanced themselves from the issue. (In a general election, he noted, costs could certainly diminish that support.)

“The long-term care piece is unbelievably significant,” he said. “It surely will help [progressives] with older voters.”

https://khn.org…

PNHP President Dr. Adam Gaffney helps introduce the Medicare for All Act of 2019

Remarks by Adam Gaffney, M.D., M.P.H.
Introductory Press Conference, H.R. 1384, February 27, 2019

I am so happy to be here today, speaking as a representative of Physicians for a National Health Program, an educational and advocacy organization of physicians across the country who know first-hand that a single-payer Medicare for All system is what this country needs.

I’d like to thank Congresswoman Pramila Jayapal for her leadership on this, and everyone here who’s joining together for this critical cause at this crucial moment.

As physicians, we see daily the harm that a for-profit, fragmented, privatized health care system imposes on our patients. We see the uninsured — the 29 million people without any health coverage — who go untreated, who develop unnecessary complications, who even die as a consequence.

We see the under-insured — the 44 million people who have coverage, but with holes and gaps so big it’s as if they’re not covered at all. These are people who go without needed care. People with asthma who don’t take their inhalers because they can’t afford the prescription. People with heart disease who don’t fill their prescription at all because they can’t afford it. People with multiple sclerosis, mental illness, or cancer who can’t get the care they need because the copays and the deductibles are too high.

Meanwhile, as physicians, we are encumbered with never-ending billing tasks and administrative tasks that take us from the bedside, that take us from the patient, from the practice of medicine itself. We see a corporate calculus replacing the fundamental calling of the medical profession and the profit motive superseding medical science and justice.

No longer. A Medicare for All system would guarantee health care for everyone in America, replacing the current welter of fragmented, inadequate plans that deny claims with universal coverage that is not only comprehensive, but first-dollar; not only portable, but seamless over life; that allows you to see the doctors and go to the hospitals that you want, not the ones that your insurance company tells you you have to go to.

At the same time, such a system would allow us as physicians to again focus on the care of patients, away from billing and back to the beside, which is why we became doctors to begin with.

Thank you so much, everyone, for joining together. The time for half-measures is over. Medicare for All, a single-payer universal health care system, is the name of the game and we’re going to win it!

more information on H.R. 1384:
pnhp.org/housebill