PNHP

Rampant health plan payment abuses

Rampant health plan payment abuses

CMA survey finds rampant health plan payment abuses

California Medical Association, April 2, 2018

Despite a California law passed in 2000 to address widespread payment abuses by health care service plans, many payers continue to flout the law. A recent survey by the California Medical Association (CMA) confirms that health plans regularly engage in unfair payment practices, with two-thirds of physician practices reporting routine payment abuses in violation of state law.

The Department of Managed Health Care (DMHC) has been slow to address provider complaints and has taken few enforcement actions against health care service plans that unlawfully underpay providers. When DMHC has acted, the penalty amounts have been small in relation to the economic injury to consumers and providers. DMHC also has refused to issue enforcement actions to cover the entire period of underpayment and has not required health care service plans to pay providers even after it has determined payment should have been made. Accordingly, health care service plans make economic decisions to violate the law, knowing that any penalty amount that may be imposed will be outweighed by the extra revenue the health plans will generate by, for example, underpaying medical care. This results in a loss of resources that should be invested on patient care.

Last month, CMA, along with its county medical societies and several specialty societies, surveyed physicians to obtain feedback on the health plans that are routinely engaging in unfair payment patterns, the types of violations and the results of physician efforts to resolve the issues both through internal plan processes as well as through DMHC. In a period of nine days, 741 physician practices representing thousands of physicians responded to the survey.

Key survey results include:

* Two-thirds of physician practice respondents report routine problems with plans engaging in various unfair payment patterns, defined as a practice, policy or procedure that results in repeated delays in the adjudication and correct reimbursement of provider claims, as outlined in 28 C.C.R. §1300.71.

* More than half of practices report that health plans attempt to rescind or modify authorizations after the physician renders the service in good faith.

* Sixty-two percent report that Anthem Blue Cross is the most problematic when it comes to unfair payment practices; Blue Shield of California was second most problematic (52 percent).

* The health plan provider dispute resolution processes are largely ineffective, with 32 percent of practices indicating disputes are resolved only half of the time, and 29 percent indicating disputes are rarely resolved through the plans’ internal processes.

* Though most practices do utilize the health plans’ internal processes to attempt to resolve issues, 63 percent report that plans routinely fail to respond to their appeals within 45 business days of receipt, as required by California law. Anthem Blue Cross is identified as the most problematic (66 percent), with Blue Shield the second most problematic (61 percent).

* When health plans do respond to physician appeals, 74 percent of practices state the health plan responses do not include a clear explanation for the plans’ determination.

These survey results confirm that health plans overwhelmingly continue to engage in unfair payment practices, despite the legislation that passed 18 years ago attempting to stop these abuses. It further demonstrates that, although plans are required to maintain fast, fair and cost-effective provider dispute processes, their processes are largely ineffective.

http://www.cmanet.org…

CMA Survey Finds Widespread Unfair Payment Practices by Health Plans:
http://www.cmanet.org…

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Comment:

By Don McCanne, M.D.

One of the primary reasons for enacting the Affordable Care Act instead of a Medicare for All program was to protect and perpetuate the role of the private insurers. Yet observing their rampant abusive payment practices, that did not seem like such a wise decision.

The Blues were the epitome of plans that they wanted to support, yet Anthem Blue Cross (for-profit) and Blue Shield of California (nonprofit) were the worst abusers in this survey. Over half of the physicians surveyed reported abuses by both of the Blues in California.

ACA is not writ in stone. We do not have to continue to support this industry. We really can establish our own public health care financing system that would take care of everyone and do it in a fair way.

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Medicare Shared Savings Program has increased federal spending instead of producing savings

Medicare Accountable Care Organizations Have Increased Federal Spending Contrary to Projections That They Would Produce Net Savings

By Josh Seidman, John Feore, Neil Rosacker
Avalere, March 29, 2018

New analysis from Avalere finds that the Medicare Shared Savings Program (MSSP) has performed considerably below the financial estimates from the Congressional Budget Office (CBO) made in 2010 when the MSSP was enacted as part of the Affordable Care Act. This has raised questions about the long-term financial success of Medicare’s largest alternative payment model (APM). The MSSP has grown from 27 ACO participants in 2012 to 561 in 2018. Most MSSP accountable care organizations (ACOs) continue to select the upside-only Track 1, which does not require participants to repay the Centers for Medicare & Medicaid Services (CMS) for spending above their target.

Avalere’s research shows that the actual ACO net savings have fallen short of initial CBO projections by more than $2 billion. In 2010, the CBO projected that the MSSP would produce $1.7 billion in net savings to the federal government from 2013 to 2016. However, the MSSP increased federal spending by $384 million over that same period, a difference of more than $2 billion.

While the MSSP overall was a net cost to CMS in 2016, there is evidence that individual ACO performance may improve as they gain years of experience with the program.

Avalere’s analysis also shows that the downside-risk models in the MSSP (Tracks 2 and 3) have experienced more positive financial results overall, indicating the potential for greater savings to CMS over time as the number of downside-risk ACOs increase. The upside-only model (MSSP Track 1) increased federal spending by $444 million compared to the downside-risk ACOs (MSSP Tracks 2 and 3) that reduced federal spending by $60 million over 5 years.

“While data do suggest that more experienced ACOs and those accepting two-sided risk may help the program to turn the corner in the future, the long-term sustainability of savings in the MSSP is unclear. ACOs continue to be measured against their past performance, which makes it harder for successful ACOs to continue to achieve savings over time,” said John Feore, director at Avalere Health.

http://avalere.com…

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How does the Affordable Care Act define ACOs?

Quote of the Day, October 28, 2010

Re: Shared Savings Program – New Section 1899 of Title XVIII (from CMS)

From the Comment by Don McCanne, M.D.

So how do ACOs achieve higher quality and lower cost?

The ACOs are not rewarded monetarily for meeting the quality standards. Their motivation to comply is to avoid being suspended from the program.

Costs are reduced by the shared savings program. A benchmark is established for each ACO “using the most recent available 3 years of per-beneficiary expenditures for parts A and B services for Medicare fee-for-service beneficiaries assigned to the ACO.” If the ACO can provide care for costs below the benchmark, the ACO then shares those savings with HHS. The benchmark is reset at the beginning of each 3 year agreement.

If the costs are above the benchmark, then the fees are still paid as usual, with no adjustments.

Think about this. The incentives continue to promote greater volume. There is no penalty for running the charges up. Is the reward for reducing the volume and intensity of services enough? Since fixed costs for the ACO are relatively unchanged, the reductions in marginal overhead expenses due to reduced volume must be greater than the amount of savings that HHS shares with the ACO in order to come out ahead. Since this is the opposite of “making it up in volume,” it is more likely that net income will be reduced. Further, since the benchmarks are reset every 3 years based on lower utilization, it is very unlikely that that the ACO could continue to ratchet down services to qualify for shared savings.

https://pnhp.org…

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Comment:

By Don McCanne, M.D.

The Medicare Shared Savings Program (MSSP) is Medicare’s largest alternative payment model (APM). This report shows that the program increased federal spending instead of producing net savings. Yet CMS is insisting on moving forward with APMs.

It is not as if this result is a surprise. Even an amateur policy wonk like me saw problems with it as it was being set up in 2010 (see my comment above).

The optimism that this might turn around does not seem to be warranted. In 2010, I wrote, “since the benchmarks are reset every 3 years based on lower utilization, it is very unlikely that that the ACO could continue to ratchet down services to qualify for shared savings.”

Now John Feore, director at Avalere Health, states, “ACOs continue to be measured against their past performance, which makes it harder for successful ACOs to continue to achieve savings over time.”

How could any health care organization continue to increase savings year after year under these terms? Once the low hanging fruit is gone and cherry pickers are used to harvest the rest, they expect that moving to downside risk is going to increase the return for the ACOs while further reducing federal spending? What kind of accounting magic is this?

This does provide yet one more lesson on why it has been a mistake to continue to try to chase screwy business models of financing health care when the obvious solution would be government administered pricing through a single payer national health program – an improved Medicare for all. But the greater lesson here is that we must exercise much more diligence in selecting our government stewards. Both the Democrats and the Republicans have taken us down the wrong path.

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Medicare-for-all would fix PEIA and other employers’ headaches

By Carol Paris, M.D.
Charleston (W.V.) Gazette-Mail, April 1, 2018

During the historic West Virginia teacher strike, 22,000 workers stood up and made themselves heard, shutting down schools statewide for nine full days, before finally settling on a 5 percent raise for state employees across the board.

West Virginia and its teachers hold a special place in my heart. I graduated and completed my residency in adult psychiatry at the West Virginia University School of Medicine, and between 1983 and 1999 I raised my family in Morgantown, where my kids spent their K-12 years in public schools. The teachers there helped my children grow and thrive, and I think they deserved a 5 percent raise and more.

I want this raise for teachers so they have more money in their pockets for things like rent, food, goods and services, but a 5 percent pay increase means little in the face of skyrocketing health care costs.

That raise won’t cover the rising costs of the state’s Public Employee Insurance Agency (PEIA) plans. Teachers in the state pay for 20 percent of the PEIA funds, and as health care costs constantly rise, so is the amount coming out of their paycheck each month. Year after year, they’re essentially taking a pay cut.

Teachers are not alone. This is a problem across the country, as health care costs rise faster than overall inflation and wage growth. The costs of employer plans rose 19 percent between 2015-2017, which is slower than the cost hikes in the individual market, but far outpaces the 6 percent inflation rate and the 12 percent wage growth across those years.

Workers must shoulder more of the cost of their premiums. While companies pay a portion, their contribution only increased their payments by 1.4 percent in 2017, while employee contributions went up 8.3 percent.

If we want to get serious about controlling the rising costs of health care and addressing income inequality, Medicare for all is the clear answer. A single-payer bill like House Resolution 676, The Improved and Expanded Medicare for All Act, would improve Medicare’s benefits by covering all medically necessary care (including dental, vision and long-term care), and expanding Medicare to cover everyone, regardless of age, income or employment.

This program would save an estimated $617 billion annually by slashing administrative waste of private insurance ($504 billion) and bargaining down drug prices ($113 billion), freeing up enough money for universal coverage without any net increase in U.S. health spending.

Under Medicare for all, workers would no longer need to fight tooth-and-nail just to hang on to basic coverage, or be tied to jobs they don’t want just to keep their families insured.

Organized labor could focus on wages and working conditions instead of haggling over premiums and deductibles. Not surprisingly, several major unions have signed on to the Labor Campaign for Single Payer or passed resolutions in support for Medicare for all.

Medicare for all would also be a boon for small and mid-sized businesses, many of whom have been struggling to cover increasing premiums, and are forced to spend countless hours and headaches administering health benefits for workers. With Medicare for all, they’d be able to reinvest that money into increasing wages, hiring new employees, investing in new technologies, and more.

And with a federally funded Medicare-for-all plan, cities, counties and states would no longer need to continually raise local taxes or slash operating budgets to fund public workers’ health coverage.

The power of the West Virginia teacher strike is enough to make us think about labor battles of the past century, when organized workers won a minimum wage and the five-day work week, health and safety laws, and expanded health care benefits.

This strike demonstrates that the modern-day union still has an incredible amount of political and organizing power. Along with doctors, business owners and other advocates, together we can win the fight for Medicare for all.

Dr. Carol Paris is a psychiatrist, president of Physicians for a National Health Program, and a member of the Board of Advisors to the Business Initiative for Health Policy.

https://www.wvgazettemail.com…

Is a for-profit health system our best choice?

By Marsha Fretwell, M.D.
Citizen Times (Asheville, N.C.), March 30, 2018

In contrast to Gov. Roy Cooper’s and the Mission Administrative Physicians’ gallant effort to put a positive spin on the possible conversion of our Mission Health from a non-profit status to for-profit status under the management of HCA Healthcare of Nashville, I would like to present strong opposition to the proposal. As a retired physician whose practice was 97 percent supported by Medicare, I was able to experience directly the joy of practicing under a nonprofit single-payer insurer. I was able to focus on the needs of my patients without concern for their ability to pay. I now refer to myself as “The Last Happy Doctor” to demonstrate the demoralizing effect of for-profit insurance on the practice of medicine.

In this country, we have been experimenting with the ”free-market,” or for-profit system of health care, since the late 1970s, early 80s, giving us nearly 40 years to actually see how this economic model is working. How has this strategy of for-profit financing of health insurance, prescription medications, hospitals, some specialty physicians, and medical equipment providers affected the rest of us…the taxpayers, the employers and individuals purchasing these products, the front line primary care providers, and all recipients of this care?

Comparing ourselves to other industrialized countries that provide universal coverage over this period of time, we have seen only increases in health care costs and diminishing health outcome such as infant mortality and average life span. We have some of the highest costs and are not even covering everyone (more than 22 million individuals remain uninsured). Many of our primary care physicians are leaving practice due to the stress of trying to provide patient centered care in a system that is designed for maximizing profits, not patient outcomes. Finally, the uncertainty and continually rising cost of insurance coverage is threatening the economic viability of our American employers and our city and county governments, and the financial security of many individuals, thereby increasing the frequency of chronic physical and mental illness.

An additional and critical issue, not often discussed in the public and political arena, is: What is the impact of our unequal and unjust health care system on the spiritual and moral life of our nation? Recently in Asheville, the educational organization HealthCare for All WNC sponsored a nonpartisan conference where representatives of the major faith traditions each spoke passionately to the moral obligation of health care. They were unanimous in support of providing heath care to all. Our earliest ancestors were hard-wired in their brains to care for their infants, and for each other, and that wiring persists to our modern times. Why did and do these neural pathways exist? Because families, villages, communities, states, and nations will not survive if they, in fact, do not care for each other. Caring for each other is critical to the survival of this nation. We have already experienced the cyber barbarians interfering in our elections. What further evidence of our vulnerability do we need?

I choose to work toward nonprofit health care coverage for all because I see it as an opportunity to heal some of the painful fractures in our nation and re-establish caretaking as a value common to all citizens in our country. The major argument from those benefiting in power and money from our current system is that a nonprofit system of universal coverage is utopian, idealistic, and won’t work. Well, as outlined above, the for-profit system in place for 40 years has not worked to either lower prices or improve patient outcomes. Secondly, we are not seeking the creation of an “ideal” model of care. We are merely seeking to reduce the inequality and social and economic injustice of the current economic model of care. Other countries of a variety of sizes and ethnic compositions have already demonstrated that having a nonprofit payer of health insurance reduces costs and improves outcomes. This payer must also have the authority to negotiate prices of all prescription medications and health care or medical services.

We are at a crossroads in this nation. We must, and are free to, each make a choice about which economic and moral model will best support our health care system. We can either choose a nonprofit single payer health insurance system that provides adequate health care for all our citizens, or we could choose to continue in a system that is not only unequal and unjust, but has already demonstrated that it is economically not sustainable. The ancients write of societies that are generous, compassionate, and truthful as opposed to those that are greedy, hateful, and living in a delusion. Which do you choose? Make your choice. It is time for change.

Dr. Marsha Fretwell is a retired geriatric medicine physician living in Asheville, North Carolina. She is a member of HealthCare for All WNC (www.healthcareforallwnc.org) an affiliate of Physicians for a National Health Program (www.pnhp.org).

https://www.citizen-times.com…

Howard Waitzkin and his colleagues explain capitalism’s barriers to health care reform

Health Care Under the Knife: Moving Beyond Capitalism for Our Health

By Howard Waitzkin and the Working Group on Health beyond Capitalism
Monthly Review Press, March 2018

Contents

Introduction: What We’re Trying to Do Here and Why by Howard Waitzkin

PART ONE: Social Class and Medical Work

1. Disobedience: Doctor Workers, Unite! by Howard Waitzkin

2. Becoming Employees: The Deprofessionalization and Emerging Social Class Position of Health Professionals by Matthew Anderson

3. The Degradation of Medical Labor and the Meaning of Quality in Health Care by Gordon Schiff and Sarah Winch

4. The Political Economy of Health Reform by David Himmelstein and Steffie Woolhandler

PART TWO: The Medical-Industrial Complex in the Age of Financialization

5. The Transformation of the Medical-Industrial Complex: Financialization, the Corporate Sector, and Monopoly Capital by Robb Burlage and Matthew Anderson

6. The Pharmaceutical Industry in the Context of Contemporary Capitalism by Joel Lexchin

PART THREE: Neoliberalism and Health Reform

7. Obamacare: The Neoliberal Model Comes Home to Roost in the United States – If We Let It by Howard Waitzkin and Ida Hellander

8. Austerity and Healthcare by Adam Gaffney and Carles Muntaner

PART FOUR: The Trajectory of Imperialism’s Health Component

9. Imperialism’s Health Component by Howard Waitzkin and Rebeca Jasso-Aguilar

10. U.S. Philanthrocapitalism and the Global Health Agenda: The Rockefeller and Gates Foundations, Past and Present by Anne-Emanuelle Birn and Judith Richter

PART FIVE: The Road Ahead

11. Resisting the Imperial Order and Building an Alternative Future in Medicine and Public Health by Rebeca Jasso-Aguilar and Howard Waitzkin

12. The Failure of Obamacare and a Revision of the Single-Payer Proposal after a Quarter-Century of Struggle by Adam Gaffney, David Himmelstein, and Steffie Woolhandler

13. Overcoming Pathological Normalcy: Mental Health Challenges in the Coming Transformation by Carl Ratner

14. Confronting the Social and Environmental Determinants of Health by Carles Muntaner and Rob Wallace

15. Conclusion: Moving beyond Capitalism for Our Health by Adam Gaffney and Howard Waitzkin

From the Conclusion

As Obamacare is increasingly recognized as insufficient and inadequate, the demand for such fundamental change in capitalist health care, as well as the economic system that shapes both health care and health itself, will continue to grow. We have highlighted several facets of the struggle ahead: organizing among health workers including physicians; building communal, democratic structures and processes within health care organizations; and transforming political parties and social movements so they become forces that can achieve fundamental change in health care and in capitalist society. Such struggles also must target the social and environmental pathologies that capitalist society constructs as normal and impact health in ways even more important than health care.

The forces that resist these changes command wealth and power that emanate from a tiny part of the U.S. population (less than the 1 percent made famous by the Occupy movement) and an even tinier part of the world’s population. Those in this minority will no doubt continue to fight ferociously to preserve the profound advantages they gain from the status quo, of which capitalist health care figures as only one part. Though the power of this small number should not be underestimated, neither should ours. The road ahead is a steep one, but given the fragility of our harsh capitalist system together with the discontent and suffering it breeds, it is one that we can and must surmount.

https://monthlyreview.org…

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Comment:

By Don McCanne, M.D.

Those of us who have been working for such a long time on trying to bring all of us together into a high quality health care system that is equitable and affordable have certainly been frustrated by the barriers that have locked us out of an obviously superior system. “Health Care Under the Knife” by Howard Waitzkin and his colleagues is invaluable because it enlightens us as to just what those barriers are (hint: it has to do with some of the dysfunctions of our capitalist system). Understanding those barriers is an essential prerequisite to organizing our strategy to move forward in achieving health care justice for all.

Highly recommended.

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

Shulkin: Privatizing the V.A. will hurt veterans

Embattled Veterans Affairs Secretary David Shulkin fired in latest White House shake-up

By David S. Cloud
Los Angeles Times, March 28, 2018

President Trump on Wednesday fired David Shulkin, the embattled head of the Department of Veterans Affairs, the latest high-profile ouster to roil the White House.

Shulkin ran afoul of some conservatives for his go-slow approach to expanding government-paid private care for military veterans outside the VA system. Shifting more veterans to private care is a top priority for the influential network of conservative groups funded by Charles and David Koch.

An effort to expand the existing Veterans Choice program, under which veterans can get government reimbursement for seeing a private doctor in certain circumstances, failed this month when Congress did not include it in the massive government spending bill that Trump signed into law.

The Koch-backed Concerned Veterans of America has pushed for the legislation, but most other major veterans organizations opposed it.

Sen. Bernie Sanders (I-Vt.) said the Senate should examine (Trump VA Secretary nominee Dr. Ronny) Jackson’s views on privatization of VA care. “Every major veterans organization in this country vigorously opposes the privatization of the VA,” Sanders said. “I stand with them. Our job is to strengthen the VA in order to provide high-quality care to our veterans, not dismember it.”

http://www.latimes.com…

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David J. Shulkin: Privatizing the V.A. Will Hurt Veterans

By David J. Shulkin
The New York Times, March 28, 2018

During my tenure at (the Department of Veterans Affairs), we have accomplished a tremendous amount. We passed critical legislation that improved the appeals process for veterans seeking disability benefits, enacted a new G.I. Bill and helped ensure that we employ the right people to work at the department. We have expanded access to health care by reducing wait times, increasing productivity and working more closely with the private sector. We have put in place more and better mental health services for those suffering from the invisible wounds of war. We are now processing more disability claims and appeals than ever before and, for the first time, allowing veterans to see the status of their appeals by simply logging on to their accounts. Unemployment among veterans is near its lowest level in years, at 3.5 percent, and the percent of veterans who have regained trust in V.A. services has risen to 70 percent, from 46 percent four years ago.

It seems that these successes within the department have intensified the ambitions of people who want to put V.A. health care in the hands of the private sector. I believe differences in philosophy deserve robust debate, and solutions should be determined based on the merits of the arguments. The advocates within the administration for privatizing V.A. health services, however, reject this approach. They saw me as an obstacle to privatization who had to be removed. That is because I am convinced that privatization is a political issue aimed at rewarding select people and companies with profits, even if it undermines care for veterans.

Until the past few months, veteran issues were dealt with in a largely bipartisan way. (My 100-0 Senate confirmation was perhaps the best evidence that the V.A. has been the exception to Washington’s political polarization). Unfortunately, the department has become entangled in a brutal power struggle, with some political appointees choosing to promote their agendas instead of what’s best for veterans. These individuals, who seek to privatize veteran health care as an alternative to government-run V.A. care, unfortunately fail to engage in realistic plans regarding who will care for the more than 9 million veterans who rely on the department for life-sustaining care.

The private sector, already struggling to provide adequate access to care in many communities, is ill-prepared to handle the number and complexity of patients that would come from closing or downsizing V.A. hospitals and clinics, particularly when it involves the mental health needs of people scarred by the horrors of war. Working with community providers to adequately ensure that veterans’ needs are met is a good practice. But privatization leading to the dismantling of the department’s extensive health care system is a terrible idea. The department’s understanding of service-related health problems, its groundbreaking research and its special ability to work with military veterans cannot be easily replicated in the private sector.

I have fought to stand up for this great department and all that it embodies. In recent months, though, the environment in Washington has turned so toxic, chaotic, disrespectful and subversive that it became impossible for me to accomplish the important work that our veterans need and deserve. I can assure you that I will continue to speak out against those who seek to harm the V.A. by putting their personal agendas in front of the well-being of our veterans.

https://www.nytimes.com…

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Comment:

By Don McCanne, M.D.

The Koch brothers’ goal is to reduce the role of government and the need to pay taxes to support it. In this instance they would move care for our veterans from the highly acclaimed V.A. Health system (acclaimed except for a couple of glitches) to the private health care delivery system. David Shulkin explains in his NYT op-ed why this would be a terrible injustice for our veterans with health care needs.

When we eventually establish a single payer Medicare for all program, it is likely that the VA Health system will continue to be supported as part of our health care delivery system because of its expertise in providing specialized services for the unique needs of our veterans. The last thing we should be doing now is allowing anti-government ideologues to wreak havoc on our health care delivery system.

When the private wealth class is failing us, it’s time for us to elect government stewards who care for and will act on behalf of all of us, including our veterans, and not just on behalf of their wealthy friends.

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

Medicare works at fraction of insurance industry costs

By Ed Weisbart, M.D.
Springfield (Mo.) Business Journal, March 29, 2018

The unpredictable and unbearable cost of our health care system drives Americans into bankruptcy, keeps us from life-saving care and distracts our business community from their core businesses.

There is a well-proven solution hiding in plain sight: Medicare. This remarkably successful program rescues American seniors from poverty while dramatically improving their health. At every age group until we turn 65, Americans have the modern world’s worst mortality rates. Once we reach Medicare eligibility, according to data published by the Institute of Medicine in 2013, our mortality rates become among the best in the world.

Medicare accomplishes this feat at a fraction of the operating overhead of the commercial insurance industry. Parts A and B of Medicare report an overhead of less than 3 percent. By comparison, Aetna, Anthem and UnitedHealthcare each report an overhead greater than 15 percent. It’s easy to understand the difference: Medicare wastes virtually nothing on sales, advertising, marketing, underwriting, multimillion-dollar executive salaries or profits.

Medicare today is imperfect. It fails to cover some important health care services (e.g., dentistry and optometry) and exposes seniors to significant financial barriers through deductibles and co-insurance. These flaws have created a niche for supplementary programs and Medicare Advantage. We should embed those corrections into the core offering and provide this improved form of Medicare to all Americans. Both chambers of Congress have popular bills that would accomplish this.

Critics say our nation cannot afford this, but they’re wrong. There are at least 25 studies at both state and federal levels demonstrating that the savings of a Medicare-for-all strategy would match or outweigh any new costs. Economists estimate that anyone earning less than $500,000 per year would save more by eliminating health care premiums, co-pays and deductibles than any small increase in the taxes needed to fund this.

Three of the most important reasons we can afford this are the elimination of the redundant middle-man insurance bureaucracy, purchasing power for pharmaceuticals and medical devices, and global budgeting for regional health care systems.

Critics also say the free market will solve our crisis, but health care is unlike most other products. Our largest health care expenses happen when we are ill, desperate and vulnerable. At those moments, we are the least able to shop around. That’s a problem for a free market solution dependent on individuals becoming more savvy consumers than large teams of actuaries and data analysts.

For more than 52 years, Medicare has proven itself. Now is the time to improve it, provide it to all and stop requiring small businesses to become small health care experts. That’s not why they’re in business. Let’s fix this for the business community, for our nation and for every American.

Dr. Ed Weisbart is chairman of the Missouri Chapter of Physicians for a National Health Program and professor of clinical medicine at Washington University in St. Louis.

http://sbj.net…

California’s lesson on consolidation of health care markets, but can we learn?

Consolidation in California’s Health Care Market 2010-2016: Impact on Prices and ACA Premiums

By Richard Scheffler, Ph.D., Director, Nicholas C. Petris Center on Health Care Markets and Consumer Welfare
University of California, Berkeley, School of Public Health, March 26, 2018

Executive Summary

This report details the rapid consolidation of the hospital, physician, and insurance markets in California from 2010 to 2016. According to the U.S. Department of Justice and Federal Trade Commission’s Horizontal Merger Guidelines, 44 counties had highly concentrated hospital markets. For physician markets, 12 counties had highly concentrated primary care markets, 20 counties had highly concentrated orthopedics markets, 22 counties had highly concentrated cardiology markets, 24 counties had highly concentrated hematology/oncology markets, and 26 counties had highly concentrated radiology markets. The commercial insurance market was also highly concentrated with 42 counties considered highly concentrated according to the Guidelines. There was also an increasing trend of hospitals purchasing physician practices. The percent of physicians working for foundations owned by hospitals increased from 24% to 39% between 2010 and 2016.

We found evidence that highly concentrated markets are associated with higher prices for a number of hospital and physician services and Affordable Care Act (ACA) premiums. In markets with Herfindahl-Hirschman Indices (HHIs) above 1,500, average inpatient procedures prices were 79% higher than the prices in markets with HHIs below 1,500. Likewise, average outpatient physician prices ranged from 35% to 63% higher (depending on the physician specialty) in markets with HHIs above 1,500. In Northern California – which is considerably more concentrated than Southern California across all measures of health care market concentration that we analyzed – inpatient prices were 70% higher, outpatient prices were 17- 55% higher (depending on the specialty of physician performing the procedure), and ACA premiums were 35% higher than they were in Southern California. Even after adjusting for input cost differences (i.e. wages) between Northern California and Southern California, procedure prices are still often 20-30% higher in Northern California than Southern California.

In sum, the pace of market consolidation in California has increased significantly. The vast majority of counties in California warrant concern and scrutiny according to the DOJ/FTC Guidelines. Consumers are paying more for health care as a result of market consolidation. It is now time for regulators and legislators to take action.

Conclusion

It is clear that the market for health care and health insurance is now highly concentrated in California. The vast majority of counties in California warrant concern and scrutiny according to the DOJ/FTC Guidelines. This has likely reduced the level of competition, which has resulted in higher prices and ACA premiums in California. The significant variation in prices and ACA premiums across the state suggests regulatory and legislative solutions need to be implemented. Consumers are paying prices for health care that are considerably above what a more competitive market would produce.

http://petris.org…

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Single-payer health care is a giant leap. Here are 14 steps California might take to get there

By Michelle Faust and Paul Glickman
KPCC, March 23, 2018

Key state lawmakers are set to introduce a series of bills designed to lower costs and expand access to health insurance on California’s individual market, following through on a strategy they embraced earlier this month that calls for an incremental approach to reform rather than an immediate push for government-backed universal health coverage.

(Use the link to see the various legislative proposals.)

https://www.scpr.org…

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Comment:

By Don McCanne, M.D.

Numerous recent reports have shown that consolidation of health care markets has resulted in higher health care prices. This study of California is particularly useful for observing the impact of consolidation because of the large size of the population and the successful implementation of the Affordable Care Act. In spite of ACA, reduced competition due to market concentration has resulted in higher prices and higher ACA premiums in most regions of the state.

The report concludes, “Consumers are paying prices for health care that are considerably above what a more competitive market would produce.” The variations in prices and ACA premiums across the state “suggests regulatory and legislative solutions need to be implemented.”

In a way this represents the primary flaw in the U.S. approach to health care financing – misplaced dependence on the dynamics of the private marketplace. The regulatory oversight and administered pricing of a well designed single payer national health program – an improved Medicare for all – is precisely what we need to overcome this. But the reaction of much of the policy community – academically and legislatively – is to look for policy solutions that would enhance private market competition. That has greatly contributed to the mess that we are in, and current incremental approaches such as establishing accountable care organizations (ACOs) and alternate payment models (APMs) will only make it worse.

The single payer bill in California has been killed and replaced with a package of 14 bills (at last count), several of which are designed to enhance the markets. California’s lesson? Don’t go there. Other nations have better performing health care systems at a much lower cost, made possible through egalitarian public (government) policies. California should join with the rest of our nation in leading us also to health care justice for all through a national single payer Medicare for all program.

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Everyone should have access to health insurance

By Ashley Duhon and Sara Robicheaux
The (Baton Rouge, La.) Advocate, Letters, March 28, 2018

As a medical student, you never forget the first time a patient says, “Thank you for your help, but I can’t afford it.” It’s the one sentence that could stop any treatment plan, regardless of the potential benefits.

Medical textbooks aid in the diagnosis and treatment of patients, but they fail to tell us how to help a patient who cannot afford care. Like millions of Americans, many of our patients leave clinics with a choice between addressing their critical health needs or paying for basic necessities. As medical students and future physicians, we cannot ignore the system that denies our patients access to the care they need and deserve.

Over the course of history — from the Greensboro sit-ins of the 1960s civil rights movement to today’s high school students leading the fight for stricter gun regulations — students have been powerful agents of social and political change.

Based on this proud tradition of student-led activism, we recently gathered in New Orleans with more than 100 fellow medical students from across the country for the annual summit of Students for a National Health Program (SNaHP). SNaHP is a national organization of medical and health professional students advocating for a single-payer, Medicare-for-all health system. The event was organized and led by passionate students who believe every patient deserves access to quality, affordable health care. Wearing our white coats and holding “Medicare for All” signs, we danced and marched in a second line parade for health justice, crossing paths with University Medical Center and Tulane Medical Center.

The day concluded with a keynote presentation by Bethany Bultman, CEO of the New Orleans Musicians’ Clinic, who explained how the majority of performance artists in New Orleans are uninsured and rely on the Musicians’ Clinic to access basic health services. Musicians are at the heart of the city’s culture, but fall through the cracks of our fractured health system — often earning too much money to qualify for Medicaid, but not enough to afford private insurance.

Musicians aren’t the only New Orleanians who experience health care rationing. According to data from the U.S. Census Bureau, approximately 54,417 people in New Orleans still do not have any form of health insurance.

Our medical education can only benefit our future patients if an insurance company deems they are worthy of care. While we are taught to see all patients as humans deserving of the highest quality care, private insurers see patients as nothing but profit. We will not stand for a system that prevents us from providing the care our patients need. In this historic political moment of student-led activism, our time is now. Your health is too important for it not to be.

The authors are medical students at Louisiana State University Health Sciences Center in New Orleans.

http://www.theadvocate.com…

NORC poll shows affording health care remains a serious problem

Americans' Views of Healthcare Costs, Coverage, and Policy

West Health Institute, NORC at the University of Chicago, March 2018

Five Things You Should Know

1) Three quarters of Americans say that our country doesn’t get good value for what we spend on healthcare.

2) Forty percent say they skipped a recommended medical test or treatment in the last 12 months due to cost, and 32 percent were unable to fill a prescription or took less of it because of its cost.

3) Four in 10 say they fear the costs associated with a serious illness, which is more than the number who say they fear the illness itself.

4) Over half of Americans say they received a medical bill they thought was covered by insurance or where the amount they owed was higher than expected, and more than a quarter say they had a medical bill turned over to a collection agency in the past 12 months.

5) About half of Americans disapprove of the way their representative in Congress is handling the cost of healthcare.

Also…

Americans’ support for a single payer healthcare system has increased from 2017 to 2018.

In February 2018, 46 percent of Americans strongly or somewhat favored a single payer healthcare system, compared to 38 percent who said the same in an AP-NORC poll conducted in January 2017. Opposition to single payer has decreased during the same period, to 28 percent in 2018 from 39 percent in 2017. The number who say they neither favor nor oppose has remained steady in 2018 compared to 2017 (24 percent vs. 22 percent).

Americans who say they have experienced significant financial consequences due to healthcare costs are slightly more likely to favor a single payer system (50 percent vs. 41 percent). Employed adults are more likely to favor single payer healthcare (52 percent vs. 38 percent), as are Democrats compared with independents or Republicans (62 percent vs. 35 percent and 29 percent). On the other hand, blacks are more likely to oppose single payer than Hispanics (29 percent vs. 18 percent).

http://www.norc.org…

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Comment:

By Don McCanne, M.D.

This new NORC poll confirms once again that our health care financing system is failing too many Americans, with 40 percent saying they skipped a recommended medical test or treatment in the last 12 months due to cost. In fact, the financial barriers are so great that more fear the costs associated with a major illness than fear the illness itself.

Although this poll does not show quite as much support for single payer as do most other polls, it does show that more individuals support single payer than oppose it and that support has increased in the past year while the opposition has decreased.

The most common reason given for continued opposition to single payer is that it would be disruptive to the dominant coverage in the United States – employer-sponsored health plans. Yet this poll shows that employed adults are more likely to favor single payer (52 percent favor vs. 38 percent oppose).

We still have more educating to do, but this poll shows that we’re certainly headed in the right direction.

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

Our multiple-payer system of health care just isn’t working

By Jay D. Brock, M.D.
Washington Post, Letters, March 27, 2018

Regarding the March 23 editorial “Maryland’s ingenious plan to fix Obamacare”:

Under our current multiple-payer system of health care, we have two major problems: Too many people have no (or unaffordable) health coverage, and we spend too much for the health care we get as a nation. Our incomprehensibly complicated and costly health insurance system diverts hundreds of billions of dollars into wasteful administrative costs rather than providing real care to real patients. Politicians can interfere with the system at will, causing more disruption that results in poor health outcomes as well as medical bankruptcies for hundreds of thousands of hard-working families each year.

Our current multiple-payer system doesn’t work well for many people or many providers — just ask patients and physicians. But it does inure to the benefit of the health insurance industry.

The editorial can recommend a little trimming here, and maybe even a little real change there, but the underlying problems remain: The current system is unwieldy, unworkable, overpriced and ultimately out of control, because in our system no one is really in charge. No one is ultimately responsible for getting everyone the health care they need rather than the health care they can afford.

Anyone have a better idea on how to solve these problems other than single-payer, national health care, which would still give Americans the best health care available?

https://www.washingtonpost.com…

Documentation of why ‘volume to value’ is failing us

Transformation of the Health Care Industry: Curb Your Enthusiasm?

By Lawton R. Burns and Mark V. Pauly
The Milbank Quarterly, March 5, 2018

Policy Points

* Policymakers seek to transform the US health care system along two dimensions simultaneously: alternative payment models and new models of provider organization.

* This transformation is supposed to transfer risk to providers and make them more accountable for health care costs and quality.

* The transformation in payment and provider organization is neither happening quickly nor shifting risk to providers. The impact on health care cost and quality is also weak or nonexistent.

* In the longer run, decision makers should be prepared to accept the limits on transformation and carefully consider whether to advocate solutions not yet supported by evidence.

Abstract

Context

There is a widespread belief that the US health care system needs to move “from volume to value.” This transformation to value (eg, quality divided by cost) is conceptualized as a two‐fold movement: (1) from fee‐for‐service to alternative payment models; and (2) from solo practice and freestanding hospitals to medical homes, accountable care organizations, large hospital systems, and organized clinics like Kaiser Permanente.

Methods

We evaluate whether this transformation is happening quickly, shifting risk to providers, lowering costs, and improving quality. We draw on recent evidence on provider payment and organization and their effects on cost and quality.

Findings

Data suggest a low prevalence of provider risk payment models and slow movement toward new payment and organizational models. Evidence suggests the impact of both on cost and quality is weak.

Conclusions

We need to be patient in expecting system improvements from ongoing changes in provider payment and organization. We also may need to look for improvements in other areas of the economy or to accept and accommodate prospects of modest improvements over time.

From the Conclusion

In conclusion, analysts and advocates may need to come to terms with the likelihood that the triple aim cannot be achieved over the long term. Rising real incomes for consumers and technical progress in discovering health‐improving but cost‐increasing new technologies may mean that cutting spending growth rates much further is not a practical goal. We may need to have more realistic expectations that, for example, the kind of high‐value but cost‐increasing care that led to dramatic improvements in cardiovascular health may be the best we can expect, and along with these improvements we should expect continuation of spending growth at an uncomfortable but not breakaway pace.

The transformation from “volume to value” in health care at this point appears to be driven more by ideology and aspiration than by evidence. To date, APMs show limited improvements in quality and even more limited reduction in costs. If improving quality does not consistently lead to lower costs but only to better health outcomes, we need to rethink the triple aim, tolerate a time when we get more health than wealth, and continue to search for other undiscovered strategies of cost containment.

https://onlinelibrary.wiley.com…

***

Comment:

By Don McCanne, M.D.

This well researched analysis (182 references!) reveals that all of the attention given to transforming our health care system from “volume to value” is misguided primarily because it is driven by ideology and aspiration rather than by evidence.

The data we do have on accountable care organizations (ACOs) and alternative payment models (APMs) have thus far failed to show greater accountability through risk transfer to providers, and thus there has been only a negligible impact on health care cost and quality. New models of provider organization through vertical and horizontal integration have failed to provide significant improvements in the triple aim (care, health and cost).

The reason this failure is so important to understand is that the attention of policymakers, politicians, and the industry has been diverted to these ineffective but intrusive, administratively wasteful, and sometimes expensive interventions while ignoring proven policies that not only would improve quality and control costs but would also address other important goals of reform that are being neglected such as universality, accessibility, efficiency, and equity. Of course, those goals would be achieved by enacting and implementing a well designed single payer national health program – an improved Medicare for all – though the authors of this article do not venture there.

The publisher has allowed free access to this article. Although long (53 pages) it is worth downloading (at least the link) to use as an explanation to incrementalists and others of just why the the misguided campaign for volume to value needs to be set aside so that we can move forward with proven policies that will ensure quality health care for everyone.

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