By Diana Farrell, Fiona Greig, Amar Hamoudi, JPMorgan Chase Institute
Health Affairs, Health Policy Brief, December 13, 2018

Consumer health care spending is sensitive to cash flow fluctuations, causing patients to defer health care.

Key Points

• Bank transaction data reveal that in any given year, one in six families makes an extraordinary health care payment of roughly $2,000 in a single month. They time such payments to coincide with positive cash flow events, yet they have not recovered financially even a year later, as evidenced by a lower level of liquid assets and higher credit card debt.
• Consumers increase health care spending by 60 percent in the week after receiving a tax refund, and the majority of these payments are made in person—likely for care received on that day. This increase is much larger for people in the lowest quintile of account balances.
• Health care spending is sensitive to a wide range of cash flow events, including job loss and the end of unemployment insurance, natural disasters, and mortgage interest rate changes.
• The findings suggest that many consumers make decisions about when to pay for and receive health care based on whether they have cash on hand. Further efforts are needed to reduce out-of-pocket spending for families and encourage and enable them to save. The health care system should promote cost transparency and support discussions between providers and patients about the costs of care.

A large body of literature documents the relationship between health care spending and consumer finance, including the impact of such spending on long-term debt, poverty, and use of health services.

This brief highlights the health care–finance connection… by exploring how short-term changes in household cash flow influence consumer decisions about whether and when to seek medical care. The JPMorgan Chase Institute brings to these questions new empirical evidence based on high-frequency banking transaction data for large samples of Chase checking account customers.

Our data show that consumers immediately increase their use of health services after they receive large infusions of cash. This finding suggests that consumers make health decisions — some of which have long-term consequences — based on short-term financial factors. Far from affecting only low-income people, immediate cash shortages cause people at all income levels to delay care. This behavior is especially concerning in the context of rising out-of-pocket health care spending.

Policy Implications

The trend toward increased consumer cost sharing for health care shows no signs of slowing. It has substantial support from both government regulators and health care payers, based largely on the belief that asking consumers to pay for more of the cost of their health care will cause them to seek care only when they need it, evaluate providers using price as one consideration, and avoid unnecessary treatments. Yet that is not what we see. Instead, our findings suggest that health care consumers are rationalizing consumption, but not in the ways that stakeholders expected. Consumers are making decisions based on whether they have cash in their pocket right now, not based on a longer-term view of what they could afford over time. Assuming that at least some of the delays in care are for necessary services, which is consistent with the findings of others, these delays have the potential to increase long-term costs for the entire health care system, since poorly managed chronic conditions often result in health care costs many times higher than well-managed conditions do.

Our findings also point to the importance of tools that encourage people to save. People who have cash reserves fare better when faced with an extraordinary expense, in that their finances do not show the same persistent adverse consequences of large payments. The health savings accounts and other savings vehicles that are often paired with CDHPs are a positive innovation in that regard. Yet consumers clearly do not have enough savings in them to cope with health costs. If they did, they would put cash into them when they had a cash infusion and spend money in them when they had a health need, which means that we wouldn’t see as large health care spending spikes as we do.

There are many reasons why families don’t save. They may not have the financial slack, or there may be a mismatch in timing between when they have a reserve and when they have a health need. In addition, health savings and reimbursement accounts can be used only for health expenses, which may discourage their use among people who need more flexibility. For these reasons, consumers need savings tools that are automatic, low risk, and uncomplicated.

https://www.healthaffairs.org…

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Comment:

By Don McCanne, M.D.

This study of cash flow dynamics in health care spending is a little bit different from most other health policy studies in that it uses banking data from JPMorgan Chase rather than data from the health care industry. Although it is understandable that JPMorgan Chase would focus on money management, it must be kept in mind that the application of money management to access and affordability of health care can have a significant effect on health care outcomes.

Although, in our current system, some attention might naturally be given to money management tools, at today’s more advanced state of health policy science, directing attention to our health care financing system that uses cost sharing (deductibles, copayments, coinsurance) should lead to policy decisions that would be more beneficial in ensuring that people receive the health care that they should have.

Cost sharing has been clearly shown to impair access to beneficial health care services. One reason can be that the individual may lack ready cash reserves. The solution here is easy. Eliminate cost sharing. Provide care with no additional payments required at the time of service. Instead, pay for the entire health care system in advance, using progressive tax policies so that individuals automatically pay only what they can afford. Readers already know that’s exactly the way Single Payer Medicare for All is designed to work. There are plenty of other legitimate roles for banking without intruding unnecessarily into the personal financing of health care.

Another important conclusion that can be gleaned from this report is that the highly touted health savings account (HSA) falls far short of being an ideal tool for cash management in health care. Regarding HSAs and other savings vehicles that are often paired with high-deductible health plans, the authors state, “consumers clearly do not have enough savings in them to cope with health costs. If they did, they would put cash into them when they had a cash infusion and spend money in them when they had a health need, which means that we wouldn’t see as large health care spending spikes as we do.” Also, families “may not have the financial slack, or there may be a mismatch in timing between when they have a reserve and when they have a health need. In addition, health savings and reimbursement accounts can be used only for health expenses, which may discourage their use among people who need more flexibility.”

It’s fine to have savings vehicles that earn income, if you can manage to fund them, but we should not have to rely on them as a ticket to accessing health care. Single Payer Medicare for All would take care of that need for all of us just fine.

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

By Nicholas Bagley
The Washington Post, December 15, 2018

Late Friday night, a district court in Texas declared the entire Affordable Care Act unconstitutional — lock, stock and barrel. That includes not only the individual mandate and the protections for people with preexisting conditions, but also the entire Medicaid expansion as well as a host of other ACA rules without any connection at all to health insurance.

The logic of the ruling is as difficult to follow as it is to defend, and it sets the stage for yet another round of high-stakes constitutional litigation over the future of health care in the United States.

As part of their 2017 tax reform package, congressional Republicans amended the ACA to eliminate the tax penalty. Because they couldn’t summon a filibuster-proof majority necessary to make substantive amendments, they zeroed the penalty out without also eliminating the naked instruction to buy insurance. And they trumpeted to anyone who would listen that they repealed the individual mandate — which, for all practical purposes, is precisely what they did.

But that’s not how U.S. District Judge Reed O’Connor saw it. In his view, the penalty-free mandate still amounted to a coercive exercise of government power. That meant that two individuals who’d been conscripted by red states as plaintiffs had standing to sue.

To put it bluntly, that makes zero sense. The judge asserted — without any support — that the penalty-free mandate “requires [the plaintiffs] to purchase and maintain certain health-insurance coverage.” But that’s not right. An unenforceable instruction to purchase insurance is not coercive in the slightest.

We know what Congress wanted to do in 2017: repeal the mandate and leave the rest of the act intact. Its judgment could not have been plainer.

That’s not how O’Connor sees it. In perhaps the most remarkable passage in a remarkable opinion, he wrote that the 2017 Congress “intended to preserve the Individual Mandate because the 2017 Congress, like the 2010 Congress, knew that provision is essential to the ACA.”

Your jaw should be on the floor. On no account did Congress in 2017 “intend to preserve” the individual mandate. It meant to get rid of the loathed mandate — and it did, by eliminating the penalty that gave it force and effect.

In his contempt for the ACA, O’Connor blinded himself to all this. Instead, he decided that what Congress “really” wanted was to invalidate the entire ACA.

What happens next? California has already said it will appeal, and the decision won’t take effect while that appeal is pending.

So nothing changes for the time being. And nothing should change.

This case is different; it’s an exercise of raw judicial activism. Don’t for a moment mistake it for the rule of law.

Nicholas Bagley is a professor of law at the University of Michigan Law School.

https://www.washingtonpost.com…

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The Texas ruling against Obamacare is a boon to Medicare-for-all

By Ezra Klein
Vox, December 14, 2018

The Texas ruling finding the Affordable Care Act unconstitutional is ludicrous in its reasoning and unlikely to survive appeal. It argues, in short, that since Congress removed the penalty from the individual mandate, the individual mandate is no longer a tax; because the individual mandate is not a tax, it is no longer constitutional; and if the mandate is no longer constitutional, the entire law must be judged unconstitutional.

But if you want to know why Democrats are suddenly dotting the landscape with new proposals for Medicare-for-all and Medicaid-for-all, this ruling is a useful artifact. The basic idea behind Obamacare was that a public-private system based on Mitt Romney’s Massachusetts reforms would command some Republican support, or at least acceptance, and thus be easier to pass and to expand.

Republicans have proven that theory wrong. Instead, the private-public construction of Obamacare has given opportunistic Republicans their most effective attacks on the bill. Those attacks have been legal, like this assault on the regulations governing private insurance purchase, and political, like the attacks on high deductibles and complex shopping schemes.

But with Obamacare under constant threat, Republicans have refocused Democrats on building what they failed to build in 2010: a universal health care system simple enough and popular enough that it is safe from constant political and legal assault. And that means some version of Medicare-for-all.

But nearly a decade of constant and cynical assault on what was supposed to be a compromise bill has pushed the Democratic Party left on health care policy, and persuaded Democrats everywhere that trying to compromise or placate Republicans is foolish. The legacy of the GOP’s Obamacare repeal strategy won’t be the Affordable Care Act’s destruction, but Medicare-for-all’s construction.

https://www.vox.com…

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Comment:

By Don McCanne, M.D.

There is nobody more knowledgeable on the Republican state attorneys general challenge of the Affordable Care Act (ACA) than Michigan law professor Nicholas Bagley. He describes the ridiculousness of the arguments made by U.S. District Judge Reed O’Connor in his act of judicial activism designed to declare the entire Affordable Care Act unconstitutional and thus invalid.

Briefly, Bagley refutes the judge’s two leading arguments: 1) That Congress’ cancellation of the penalty to fail to comply with the individual mandate to purchase health insurance removes this penalty as a federal tax which then he uses to invalidate, as not being applicable, the previous Supreme Court finding that the penalty is a legitimate federal tax that upholds the constitutionality of the individual mandate, and 2) That the mandate is essential to the entire legislation which would otherwise fall apart without it, and thus it is not severable; that is, he rules that removing the mandate invalidates the entire act. As Bagley says, this is “an exercise of raw judicial activism,” and not the rule of law.

We normally should be able to feel secure that the Appeals Court, and eventually the Supreme Court, would reverse this ruling, but that is not assured when we have a flawed process that selects a Supreme Court justice that uses the statement, “I like beer,” to explain away his poor judgment in the past. It is likely the decision will be reversed, but not only should we be prepared in the event that it is not, we should also use this historical moment to advance the cause of health care justice for all.

Ezra Klein describes how a decade of Republican opposition to ACA has only shown that any effort to placate or compromise would be futile, and thus we should move forward with construction of Medicare for All. Medicare is the law of the land and the half century of its continued existence solidifies the constitutionality of the program.

Ironically, by relying on a pair of non sequiturs for his decision, Judge O’Connor is awakening us to the imperative of moving forward with much needed reform right now, but reform that works best for the people and not reform that tries to fulfill the fantasies of right-wing ideologues like him.

The greatest risk at the moment is that the passion for reversing Judge O’Connor’s decision may transfer into passion for support of lesser measures: 1) moderates supporting grossly inadequate policies such as a public option or Medicare buy-in, and value-based purchasing proposals such as accountable care organizations and other MACRA alternative payment models, and 2) conservatives supporting their pet policies of consumer-directed health care, including an expansion of health savings accounts, and expanding the insurance market with inexpensive, but nearly worthless bare bones coverage.

The reform we need to aim for should not be just any old thing labeled Medicare, but it should be true health care nirvana: Single Payer Medicare for All.

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

Go for dramatic reforms. Health insurance companies are interested in profits, not playing fair. I should know. I used to be a vice president at Cigna.

By Wendell Potter
USA TODAY, December 14, 2018

Democrats have secured a 40-seat flip of the House of Representatives, based largely on a nationwide call for health care reform. Many Democrats, led by Brian Higgins of New York, are planning to use their newfound control of the House to work on a Medicare buy-in bill.

I spent 20 years as a health insurance executive before leaving my job as a vice president at Cigna. I can tell you firsthand that by focusing on a half-baked measure like a Medicare buy-in, Democrats would hand a huge gift to the private insurance industry while doing less than the bare minimum to help struggling businesses, workers, families and patients.

When the next Congress starts in January, House Democrats should use their new majority to introduce, debate and vote on significant legislation that would assure universal coverage, protect taxpayers, and dramatically transform our health care system: Medicare for All.

The Higgins plan to let people aged 50-64 to buy Medicare coverage does nothing to restrict the ability of insurers to profit from our fragmented coverage system. It would allow insurance companies to continue to control prices for almost everyone under 50, while pushing many of their most expensive-to-insure patients out of their risk pool and into Medicare’s — which shifts the cost onto taxpayers.

The Higgins bill would also allow insurance companies to continue to weaken traditional Medicare while profiting from Medicare Advantage plans — private-sector alternatives to traditional Medicare that are now a primary driver of insurance-company growth.

Seven in 10 Americans and 85 percent of Democrats are supportive of Medicare for All. Yet Higgins is pushing a bill that not only would fail to reform the broken American health care system, it would almost certainly pad insurance companies’ bottom lines.

It’s time for Democrats to stop proposing health care reform that relies on insurance companies to play fair. After two decades in the for-profit health insurance industry, I can assure you they never will. They have no interest in doing anything that might in any way jeopardize profits. Their only interest is delivering profits to their shareholders. From that perspective, the status quo is very profitable. For everyone else, not so much.

Champion dramatic reforms, not half-measures

Business owners are struggling to provide health insurance to their employees, workers’ take-home pay is shrinking as their premiums go up, patients are literally begging for their lives on fundraising platforms like GoFundMe, doctors and hospitals are drowning in paperwork dealing with insurance claims departments, and more than 80 million people lack adequate health insurance. That number is increasing every year. Reform is desperately needed.

Democrats have the chance to be the champions of that reform if they don’t waste their energy on half-measures. Instead of thinking about how they can make small tweaks to the health care system, they should start thinking about how to enact dramatic reforms that will assure universal coverage while reducing costs and encouraging economic growth. Voters and taxpayers are asking for Medicare for All. It’s time to listen.

Wendell Potter, a former health insurance executive, is president of the Business Initiative for Health Policy. Follow him on Twitter: @wendellpotter

https://www.usatoday.com…

Business Initiative for Health Policy:
http://businessinitiative.org

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Comment:

By Don McCanne, M.D.

As we are approaching a new session of Congress, there is greater discussion about initiating a legislative process that would lead to a Medicare buy-in – a public option to be offered in the current market of private health plans. Former health insurance executive Wendell Potter, who is very knowledgeable about these matters, appropriately refers to the Medicare buy-in as a “tweak,” since it would do very little to correct most of the deficiencies in our health care financing system. Enough with the tweaks.

The comprehensive reform that we desperately need is a Single Payer Medicare for All program. Democrats are in a position to begin the process by holding formal hearings in the House of Representatives and moving forward from there. Because of the increasing support amongst Republican voters, partisanship should be set aside so we can all work together advancing health policies that benefit all patients and the public at large. The process may take until the next general election, but, if so, so be it. Regardless, now is the time to start.

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

By Sarah Kliff and Dylan Scott
Vox, December 13, 2018

“Medicare-for-all” has become a rallying cry on the left, but the term doesn’t capture the full scope of options Democrats are considering to insure all (or at least a lot more) Americans. Case in point: There are half a dozen proposals in Congress that envision very different health care systems.

The eight plans fall into two categories. There are three that would eliminate private insurance and cover all Americans through the government. Then there are five that would allow all Americans to buy into government insurance (like Medicare or Medicaid) if they wanted to, or continue to buy private insurance.

The bills we reviewed are:

• Sen. Bernie Sanders’s (I-VT) Medicare-for-all bill
• Rep. Pramilla Jayapal (D-WA) and the House Progressive Caucus’s Medicare-for-all bill
• The Center for American Progress’s Medicare Extra for All proposal
• Sens. Jeff Merkley (D-OR) and Chris Murphy’s (D-CT) Medicare buy-in bill
• Rep. Jan Schakowsky (D-IL) and Sen. Sheldon Whitehouse’s (D-RI) Medicare buy-in bill
• Sen. Michael Bennet (D-CO), Rep. Brian Higgins’s (D-NY) and Sen. Tim Kaine (D-VA) Medicare buy-in bill
• Sen. Brian Schatz (D-HI) and Rep. Ben Ray Lujan’s (D-NM) Medicaid buy-in bill
• The Urban Institute’s Healthy America proposal

Here are the key questions:

How many people get covered?

Bottom line: Some plans from the Democrats would cover all Americans — while others would provide insurance to more but leave some number of people uninsured.

What happens to employer-sponsored insurance?

Bottom line: Democrats are split over whether expanded Medicare should make space for employer-sponsored plans — or get rid of them completely.

What public program will expand?

Bottom line: The vast majority of proposals expand Medicare, the plan that covers Americans over 65. But there is one option that would expand Medicaid, the plan that covers low-income Americans — and another option that creates a new government program entirely.

What benefits get covered?

Bottom line: Democrats generally agree that health insurance should cover a wide array of benefits, although there is some variation around how different plans cover long-term care, dental, vision, and abortion.

How much does it cost enrollees?

Bottom line: Democrats do not agree on whether patients should pay premiums or fees when they go to the doctor. Some plans get rid of all cost sharing, while others (largely those that allow employer-sponsored coverage to continue) keep those features of the current system intact.

How is it paid for?

Bottom line: Most Democrats have focused their energy on figuring out what exactly an expanded Medicare program looks like. Legislators have given significantly less attention to how to pay for these expansions.

https://www.vox.com…

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Comment:

By Don McCanne, M.D.

This article by Sarah Kliff and Dylan Scott helps to clarify the differences in the legislative proposals that have inappropriately been grouped together as “Medicare-for-All” proposals. That’s important since only two are bona fide Single Payer Medicare for All bills (Jayapal and Sanders), and the others are lesser bills that leave most of the current dysfunctional financing system in place while offering not much more than an additional public option.

There are enough facts in the full article that you can use to explain to others this important difference: the superiority of single payer over the inadequacy of the public option.

That said, it is also important to keep in mind that the two single payer proposals – Jayapal and Sanders – have important differences that need to be resolved. A process is underway now to do just that. As a reminder, Steffie Woolhandler and David Himmelstein have provided an explanation of the importance of aligning these two bills appropriately, available at the following link:

https://pnhp.org…

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

By Peter Sullivan
The Hill, December 11, 2018

The incoming chairman of the powerful Ways and Means Committee, Rep. Richard Neal (D-Mass.), said Tuesday that he is open to holding hearings on “Medicare for all” next year.

“The first thing we’re going to try to do is to address the issue of pre-existing conditions,” Neal told reporters when asked about Medicare for all. “But I don’t see how we can’t evolve into a hearing on many of these other proposals and discussions. I think they deserve a conversation.”

The comments, while not a firm commitment, are some of the most encouraging toward Medicare for all supporters from a top House Democrat to date. Democratic leaders and key committee chairmen have so far not given support to Medicare for all, despite a push from the progressive wing of the party.

Neal said the details of a hearing are not yet clear, and there are also other health-care issues he wants to explore.

But he said of Medicare for all, “I’m not going to ignore it, that’s for sure.”

“I think we should hold a hearing on the ACA, I think we should have a hearing on the mandate, I think we should hold a hearing on pre-existing conditions,” Neal said.

“I think we ought to have a hearing on all of it,” he added.

Progressive House Democrats are pushing for a vote on Medicare for all after Democrats take back the House next year.

House Democratic Leader Nancy Pelosi (Calif.) has not offered any commitment beyond saying earlier this year that Medicare for all would have to be “evaluated” and “it’s all on the table.”

Neal’s comments on Tuesday also go farther than those of Rep. Frank Pallone Jr. (D-N.J.), the incoming chairman of the other key committee overseeing Medicare for all, the Energy and Commerce Committee.

Pallone said last month that Medicare for all did not have the votes to pass so he would focus on the Affordable Care Act instead.

“I’ve always been an advocate for Medicare for all or single-payer, but I just don’t think that the votes would be there for that, so I think our priority has to be stabilizing the Affordable Care Act, preventing the sabotage that the Trump administration has initiated,” Pallone said last month.

https://thehill.com…

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Comment:

By Don McCanne, M.D.

In spite of candidate support for Medicare for All in the midterm elections, there has been concern that Congressional efforts would be limited to ensuring that preexisting conditions would be covered and perhaps holding hearings on a Medicare public option buy-in. Some have seemingly dismissed any consideration of Single Payer Medicare for All as not being politically feasible with Republican control of the Senate and The White House. Considering that, this report is really good news.

The incoming chairman of the powerful Ways and Means Committee, Rep. Richard Neal, says that he is open to holding hearings on “Medicare for All” next year. Even House Democratic Leader Nancy Pelosi says, “it’s all on the table.”

Although these are not promises, they are openings for us to organize grassroots efforts around to be be sure that we diplomatically remind the legislative leaders that such hearings must be of the highest priority, even if they are not expected to result in passage of legislation in this next session of Congress. The hearings are important because they can be used to refine the future legislation, and, most importantly, to educate the less-well-informed public just what it is about Single Payer Medicare for All that is deservedly making it so popular.

Who knows? With the observed increasing support amongst Republican voters maybe the legislators and President Trump will have an epiphany and finally decide to do the right thing.

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

By Adam Gaffney
The Guardian, December 11, 2018

If you can’t undercut a popular proposal as undesirable, make it sound impossible. That, in any event, has been the tack of opponents of single-payer healthcare, also called improved “Medicare-for-all”.

“[W]e got to get away from these falsehoods and start talking about the truth …” opined billionaire Starbucks CEO Howard Schultz on CNBC last June, while contending that single-payer healthcare was economically infeasible. “I think a lot of the analysis has shown it’s unaffordable,” claimed Seema Verma, head of the Centers for Medicare & Medicaid Services, last summer, quoted by Kaiser Health News.

Yet casting Medicare-for-all as an economic impossibility is becoming a sisyphean pursuit: a slew of studies – including one released just the other week – are confirming that, yes, we can afford real universal healthcare in America. But if that’s the case, why haven’t we already achieved it? Well, the real stumbling block is not that single-payer advocates’ arithmetic is poor, it’s that American politics are dominated by the rich.

Still, the numbers matter. On 30 November, a team of economists with the Political Economy Research Institute (Peri) at the University of Amherst published a highly credible, nearly 200-page economic analysis of Senator Bernie Sanders’ single-payer bill. The Peri study received essentially none of the media coverage lathered on the last such analysis – a flawed piece of work published by the conservative Mercatus Center last summer. But here’s the funny thing: though these two analyses came from economists from opposite ends of the political spectrum, they shared a similar finding: single-payer would reduce our nation’s healthcare spending bill by trillions of dollars over a decade (around $2tn and $5tn, respectively).

The numbers are big, but they shouldn’t come as a surprise. Yes, single-payer imposes some new costs: when people don’t have to worry about ruinous medical bills or ravenous debt collectors, they tend to use more healthcare, increasing costs. But such rises in utilization are likely to be modest (even more modest than these analyses predict). There are only so many doctors and hospital beds, which limits theorized surges in utilization. Anyway, there are hundreds of billions in potential savings in moving to single-payer, such as slimming down on the massive administrative bloat of the privatized American healthcare system and bringing down our sky-high drug prices.

Going back decades, studies have found that, at worst, these costs and savings will balance out under a Canadian-style single-payer reform. “In Canada, each provincial plan provides for universal insurance coverage with no deductibles or copayments, controls on provider reimbursement, and administration by a single, public payer,” the United States General Accounting Office noted in an analysis of a single-payer bill way back in 1992. “We found that if these features were applied in the United States, the administrative savings could offset the added costs.”

In a review of the Peri study that I co-authored with Professors David Himmelstein and Steffie Woolhandler at the City University of New York, we commended the robustness of the team’s much-needed and highly thorough analysis, while offering differing opinions on some of the specific assumptions. We also contended that it would be prudent to cautiously assume that overall healthcare spending would remain roughly stable (rather than fall) shortly after implementation.

But here’s the thing: a single-payer system allows cost growth to be directly controlled over time in a way that’s not possible with a privatized system. So even if a Medicare-for-all system only allows us to keep overall healthcare spending where it is today (as a proportion of the US economy), a quick back-of-the-envelope calculation using figures from the National Health Expenditures accounts shows that it would still save some $2tn over a decade.

To be clear, even as we reduce overall health spending by trillions, new taxes will be needed to replace most of the private spending – eg premiums, copays, and deductibles – that suddenly and permanently evaporate. To this end, the Peri analysis proposes a sensible mix of taxes, including payroll taxes paid by businesses, a sales tax on non-essentials, and a wealth tax on the richest among us. It would also treat capital gains like ordinary income. In exchange, we would have a healthcare system that covers everyone in the nation, without copays or deductibles, with comprehensive benefits, with no insurance networks or interruptions in coverage – and a permanent end to the soul-sucking hassle of medical bills.

There is another benefit of this system, albeit one that helps explain why we haven’t achieved it yet. A more progressive system of healthcare financing can, over time, reduce inequalities not only in health, but in wealth, helping to close our nation’s disastrous economic divide. It’s not surprising, then, that billionaires don’t much like it. Nor is it unexpected that the corporate behemoths that have the most to lose are already sharpening their swords, pouring cash into a new anti-single-payer lobbying group that, as the Intercept recently reported, is maneuvering to “influence Democratic party messaging and stymie the momentum toward achieving universal health care coverage”.

So as important as rigorous analyses and funding proposals are, we miss the forest for the trees if we see this mainly as a fight among policy wonks or dueling funding proposals. This is a struggle against the “economic royalists”, as Franklin D Roosevelt once termed them, of our day – and for the interests of ordinary working people. Good numbers do not a political movement make.

Adam Gaffney is President of Physicians for a National Health Program.

https://www.theguardian.com…

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Comment:

By Don McCanne, M.D.

Those who are up to date on the health policy literature may not find much new here, but there are a few points worth emphasizing:

• It is irrefutable that a well designed, single payer Medicare for All program would meet our health reform goals of affordability, universality, equity, effectiveness and efficiency.
• The barrier to reform is not financing since we are already spending enough to pay for such a system, especially once administrative efficiency is factored in.
• Using taxes to pay for the system should not be a problem since our current public spending on government-financed health programs, on tax expenditures for employer-sponsored plans, and on the purchase of health care for public employees would already pay for much of the system, and the remaining taxes needed would be offset by the elimination of insurance premiums, deductibles and other cost sharing.
• The fact that the taxes would be progressive would be a small step to help offset the egregious inequities in income that hold back too many of us who are contributing our fair share of effort to society while too often having to scrimp on essential needs. Tax policies should be used to adjust inequities that result in a select few being able to accumulate obscene levels of wealth – amounts far, far in excess of what their personal efforts contribute to society. They will not suffer from a very modest reduction in their excesses.
• The primary barrier to reform is political. Although Adam Gaffney says, “Good numbers do not a political movement make,” they sure do help. Advocacy is much easier when the facts are on the side of the people. So let’s all get out and nurture that political movement that we need.

The policy fight should be over. It is a political battle that we now face.

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

By Adam Cancryn
POLITICO, December 10, 2018

The united front that helped Democrats save Obamacare just a year ago is falling apart over single-payer health care.

Deep-pocketed hospital, insurance and other lobbies are plotting to crush progressives’ hopes of expanding the government’s role in health care once they take control of the House. The private-sector interests, backed in some cases by key Obama administration and Hillary Clinton campaign alumni, are now focused on beating back another prospective health care overhaul, including plans that would allow people under 65 to buy into Medicare.

This sets up a potentially brutal battle between establishment Democrats who want to preserve Obamacare and a new wave of progressive House Democrats who ran on single-payer health care.

“We know the insurance companies and the pharma companies are all putting tens of millions of dollars into trying to defeat us,” said Rep. Pramila Jayapal (D-Wash.), who co-chairs the Medicare for All Congressional Caucus. “Which I take as a badge of honor — that they’re so concerned about a good policy that they’re going to put so much money into trying to defeat it.”

The rift could come into full view in the opening weeks of the new Congress, as the party long bound by a need to defend the Affordable Care Act tries to embrace a new health care vision it can carry into the 2020 presidential campaign.

House Democratic leaders already are emphasizing the need to align behind a more pragmatic agenda focused largely on shoring up Obamacare, without peering too far into the future.

“We want to continue promoting the idea of accessibility and improving the Affordable Care Act,” said incoming Ways and Means Committee Chairman Richard Neal (D-Mass.). “That should be the primary goal that we have.”

It’s a sentiment shared by the major lobbies that fought alongside Democrats against Obamacare repeal and now want to reap the benefits. These interest groups contend that, after a decade of upheaval in health care, the public would prefer simple fixes that strengthen the ACA over a headlong rush into another dramatic overhaul of the system.

But House progressives, buoyed by voter enthusiasm and a surge of single-payer support among the party’s base, have other ideas. Among their high-profile agenda items is “Medicare for All” legislation, an idea until recently on the fringes of policy debates that polling shows captivated voters during the 2018 election cycle, despite potentially staggering costs.

“It’s more of a mainstream position than it’s ever been before,” said Adam Green, co-founder of the Progressive Change Campaign Committee, which maintains close ties to House progressives. “There’s this hugely rapid advancement toward Medicare for All — single-payer — as not just an eventual North Star goal, but as something that’s increasingly possible.”

But major lobbies that fought shoulder-to-shoulder with Democrats last year are working now to derail such liberal ideas in order to preserve the status quo.

More than a dozen groups intend to press their point next year through The Partnership for America’s Health Care Future, a vehicle to combat an expanded government role in health care.

America’s Health Insurance Plans and the BlueCross BlueShield Association helped found the coalition alongside the Federation of American Hospitals, the big drug lobby PhRMA and the American Medical Association.

Since then, it’s added another 13 organizations — most representing companies with much to lose under a system that shrinks or in some cases eliminates private health care.

The Partnership, some of whose members began discussions within weeks of Senate Republicans’ failed Obamacare repeal vote in July 2017, is planning to launch a campaign featuring ads, polling and white papers playing up the private sector’s role and warning against further disruptions to the health system, people involved with the group said. Avalere, a consulting firm Democrats often leaned on to highlight the dangers of GOP repeal bills, is producing research for the coalition.

Avalere founder Dan Mendelson — a former Clinton White House official — declined to comment on the firm’s work, citing a policy of not talking about its clients.

The Partnership has also received support from Lauren Crawford Shaver, a veteran of the Obama administration’s Health and Human Services Department and Hillary Clinton’s 2016 campaign, who is running its operations out of the lobbying shop Forbes Tate Partners.

“We believe all Americans deserve access to affordable, high-quality health care. But a one-size-fits-all, government-controlled system like Medicare for All isn’t the answer,” Shaver said, predicting it would restrict choice and innovation and put “decisions regarding our health care in the hands of politicians in Washington.”

Other groups that fought Obamacare repeal are quietly working to limit Democrats’ ambitions by highlighting the practical complexities and political risks inherent in rewiring the entire national health care system — including an employer-sponsored insurance market that serves 151 million Americans.

Officials from several groups expressed confidence that public support for Medicare for All will plunge as people become more aware of the trade-offs it would require.

“We are convinced here that, whether it’s on the state basis or federal basis, incremental change is a real possibility and is doable,” said Kenneth Raske, president of the Greater New York Hospital Association, one of the loudest voices in 2017 against both ACA repeal and a state-level single-payer effort. “In New York, we have 5 percent uninsured. Why do we want to have a 100 percent solution to a 5 percent problem?”

Liberals concede their effort faces institutional roadblocks but maintain they’re undaunted by the firepower aimed their way.

The House Democrats’ progressive wing is increasingly influential, the party has a clear advantage on health care for the first time in years and polls show the once-fringe concept of a single-payer system is captivating a growing portion of the nation.

“We want to make sure we shore up protections for pre-existing conditions [and] do everything we can to make sure the Affordable Care Act is effective as possible,” Jayapal said. “But, in the end, we still have a problem with the cost of health care for ordinary people. And so that’s what we’re trying to address.”

The progressive movement’s own lobbying campaign inside and outside Congress is just getting started, she added. That gives the party time to balance shoring up the ACA with figuring out a path to universal health care that could range from incremental steps like adding a public option all the way up to a full single-payer system.

And in the meantime, progressives say they’re more concerned about courting voters than winning over big business. For as much as the industry lobbies contributed to defending Obamacare, they argue, the repeal fight demonstrated even more convincingly that Democrats can win any health care battle if the public is on their side.

“People across this country have worked through for themselves the public debate on the government’s role in health care, and America has shifted,” said Sen. Elizabeth Warren (D-Mass.), a Medicare for All supporter and likely 2020 presidential candidate. “So the importance of persuading every one of the insiders that this is going to be a great deal for them has diminished.”

https://www.politico.com…

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Comment:

By Don McCanne, M.D.

This article gives us a brief update on the politics of Medicare for All. The opposition by certain vested interests is understandable since some of them stand to have their highly lucrative roles displaced partially or completely by a system that instead places patients first.

As Sen. Elizabeth Warren states, “People across this country have worked through for themselves the public debate on the government’s role in health care, and America has shifted. So the importance of persuading every one of the insiders that this is going to be a great deal for them has diminished.”

Patients first.

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By Sara R. Collins and David C. Radley
The Commonwealth Fund, December 7, 2018

Recent national surveys show health care costs are a top concern in U.S. households. While the Affordable Care Act’s marketplaces receive a lot of media and political attention, the truth is that far more Americans get their coverage through employers. In 2017, more than half (56%) of people under age 65 — about 152 million people — had insurance through an employer, either their own or a family member’s. In contrast, only 9 percent had a plan purchased on the individual market, including the marketplaces.

Highlights

• After climbing modestly between 2011 and 2016, average premiums for employer health plans rose sharply in 2017. Annual single-person premiums climbed above $7,000 in eight states; family premiums were $20,000 or higher in seven states and D.C.
• Rising overall employer premiums increased the amount that workers and their families contribute. Average annual premium contributions for single-person plans ranged from $675 in Hawaii to $1,747 in Massachusetts; family plans ranged from $3,646 in Michigan to $6,533 in Delaware.
• Average employee premium contributions across single and family plans amounted to 6.9 percent of U.S. median income in 2017, up from 5.1 percent in 2008. In 11 states, premium contributions were 8 percent of median income or more, with a high of 10.2 percent in Louisiana.
• The average annual deductible for single-person policies rose to $1,808 in 2017, ranging from a low of $863 in Hawaii to a high of about $2,300 in Maine and New Hampshire. Average deductibles across single and family plans amounted to 4.8 percent of median income in 2017, up from 2.7 percent in 2008. In three states (Florida, Mississippi, and Tennessee), average deductibles comprised more than 6 percent of median income.
• Combined, average employee premium contributions and potential out-of-pocket spending to meet deductibles across single and family policies rose to $7,240 in 2017 and was $8,000 or more in eight states. Nationally, this potential spending amounted to 11.7 percent of median income in 2017, up from 7.8 percent a decade earlier. In Louisiana and Mississippi, these combined costs rose to 15 percent or more of median income.

Worker payments for employer coverage are growing faster than median income.

The average employee premium cost across single and family plans amounted to 6.9 percent of median income in 2017, up from 5.1 percent in 2008.

Average deductibles are also outpacing growth in median income.

In many states, even though costs are rising, people are not getting insurance that protects them more because deductibles are also increasing.

From the Conclusions

Families’ costs for employer health insurance are rising faster than median income. Moreover, even as costs climb, many families aren’t receiving higher-quality insurance. The amount they have to spend out of pocket before their insurance coverage kicks in also continues to climb. While this study only considered families with middle incomes, lower-income families with employer coverage will use an even larger share of their income for health insurance costs.

Higher costs for insurance and health care have implications. People with low and moderate incomes may simply decide to go without insurance if it competes with other critical living expenses like housing, food, and education. In 2017, average per-person expenditures on food in the U.S. amounted to 13 percent of median income and housing costs were 32 percent. People with coverage but deductibles that are high relative to income are nearly as likely as those uninsured to skip needed health care, like filling prescriptions or going to the doctor when they are sick.

Health care cost growth is the primary driver of premium growth across all health insurance markets. Policymakers will need to recognize that the increasing economic strain of health care costs facing middle-income and poor Americans is driven by multiple interrelated factors and will require a comprehensive solution.

https://www.commonwealthfund.org…

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Comment:

By Don McCanne, M.D.

When the Affordable Care Act (ACA) was crafted, the sector of the private insurance market that the legislators most wanted to protect was the employer=sponsored plans. It was perceived as the private insurance sector that was still working well and the private plans with which satisfaction was the greatest (leading to the unfortunate promise, “if you like your health plan, you can keep it”).

The disappointing conclusions of this study should surprise no serious student of health policy. The excessive growth rate in health care spending needed to be addressed in the ACA legislation, but it included only token “wish-it-would-work” policies such as accountable care organizations and other value-based policy proposals. The only measures that would actually work were those that expanded barriers to beneficial care such as excessive, unaffordable deductibles and other cost sharing, and penalties for obtaining care outside of restrictive provider networks. These concepts defeat the purpose of a program that should be designed to assist patients in accessing the care that they need.

With perpetually increasing costs, it is no wonder that employees and their families are faced with higher premiums and higher deductibles. Not only that, they are paying for the increased premium contributions of their employers through their own forgone wage increases. It is easy to see how employer-sponsored insurance is a growing burden, especially for middle- and low-income families.

It is no secret that the policy design of our current health care financing system has caused it to fall far short of the goals of reform, and the tragedy is that these defects were known when ACA was crafted. But, at this stage, instead of crying over spilt milk (more accurately, spilt blood), we should promptly move forward with enacting policy improvements that will fix our system. Those improvements, of course, would be inherent in a well designed Single Payer Medicare for All program. That strategic move would automatically bring affordable, accessible care to absolutely everyone. Burdens, such as those that the employer provided plans are placing on us, would no longer be necessary.

The authors state, “Policymakers will need to recognize that the increasing economic strain of health care costs facing middle-income and poor Americans is driven by multiple interrelated factors and will require a comprehensive solution.” Obviously, that comprehensive solution would be Single Payer Medicare for All.

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