PNHP

Payment sources and patient racial mix at academic medical centers

Payment sources and patient racial mix at academic medical centers

Hospital Payer and Racial/Ethnic Mix at Private Academic Medical Centers in Boston and New York City

By Roosa Sofia Tikkanen, Steffie Woolhandler, David U. Himmelstein, Nancy R. Kressin, Amresh Hanchate, Meng-Yun Lin, Danny McCormick, Karen E. Lasser
International Journal of Health Services, February 2, 2017

Abstract

Academic medical centers (AMCs) are widely perceived as providing the highest-quality medical care. To investigate disparities in access to such care, we studied the racial/ethnic and payer mixes at private AMCs of New York City (NYC) and Boston, two cities where these prestigious institutions play a dominant role in the health care system. We used individual-level inpatient discharge data for acute care hospitals to examine the degree of hospital racial/ethnic and insurance segregation in both cities using the Index of Dissimilarity, together with recent changes in patterns of care in NYC. In multivariable logistic regression analyses, black patients in NYC were two to three times less likely than whites, and uninsured patients approximately five times less likely than privately insured patients, to be discharged from AMCs. In Boston, minorities were overrepresented at AMCs relative to other hospitals. NYC hospitals were more segregated overall according to race/ethnicity and insurance than Boston hospitals, and insurance segregation became more pronounced in NYC after the Affordable Care Act. Although health reform improved access to insurance, access to AMCs remains limited for disadvantaged populations, which may undermine the quality of care available to these groups.

From the Introduction

Academic medical centers (AMCs) play a unique role in the U.S. health care system. These institutions, which typically comprise a medical school and a closely affiliated teaching hospital, train health professionals, conduct research, and provide patient care. AMCs are often among the largest hospitals in their service areas: despite representing only 5% of the nation’s hospitals, combined, they account for one-fifth of the total hospital volume in the United States. AMCs typically serve a medically complex patient population and provide specialized expertise across a range of clinical areas. Many AMCs are ranked among the top hospitals in the country, and patients treated at AMCs are more likely than other patients to receive treatments using the latest technologies and care adhering to current clinical guidelines.

For these reasons, AMCs are often recognizable brands and attract referrals from nearby counties, states, and, increasingly, from other countries as well. At the same time, many AMCs are key safety-net providers in their communities and have historically provided approximately one-third of all charity care and one-quarter of all Medicaid hospitalizations. Yet, recent reports raise concern that uninsured and Medicaid patients face barriers to obtaining care at AMCs.

Racial and ethnic minorities, who are more frequently uninsured or covered by Medicaid than other Americans, often encounter access barriers. Unequal access to high-quality health facilities, including AMCs, is recognized as a contributor to racial and ethnic health disparities.

From the Discussion

Our analyses of adult hospital discharges indicate that minority, uninsured, and Medicaid patients are strikingly underrepresented at NYC’s private AMCs. This pattern has not improved and – regarding insurance status — became even more pronounced after the passage of the ACA. In contrast, care was less segregated according to both race/ethnicity and insurance in Boston. Indeed, minorities were slightly overrepresented, although Medicaid and uninsured patients were underrepresented, at Boston’s AMCs.

What explains the greater racial/ethnic and payer segregation in NYC’s AMCs relatives to Boston’s? First, the extensive network of public hospitals in NYC relieves pressure on that city’s private AMCs to care for disadvantaged patients, allowing AMCs there to focus on serving as referral centers for privately insured patients living in predominantly white, suburban communities. In contrast, only one relatively small public hospital remains in the Boston area. Second, AMCs in Boston may be less resistant to integrating the comparatively small number of minority and uninsured patients in that city. Finally, Boston Medical Center, a private AMC that incorporates a previously public hospital, continues to serve many poor and black patients.

The case for desegregation is morally and medically compelling. Disparities in access to high-performing health facilities contribute to racial/ethnic disparities in both quality of care and health outcomes. Ensuring equal access to health facilities is a stated policy priority of both federal and NYC authorities.

http://journals.sagepub.com…

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Comment:

By Don McCanne, M.D.

Academic medical centers (AMCs), with their great resources and advanced technologies, are ideal to provide specialized care for certain patients with complex medical needs. A high performance health care system should provide equitable access for those who would most benefit from the services offered by AMCs. This study indicates that race and insurance status may contribute to inequities and disparities in access to these facilities.

There are many contributing factors, some of which are discussed in the article. It is clear that one significant factor is the fragmentation in the financing of health care – both in funding of the health care delivery infrastructure and in the various forms of public and private insurance coverage or lack thereof.

Patients are treated differently based on whether they are uninsured, or if they are on Medicaid with its low reimbursement rates, or on the basis of the richness or sparseness of the benefits offered by their private plans, or on the makeup of the provider networks established by their insurers.

A single payer national health program, including separate allocation of resources for health care delivery infrastructure, would dramatically reduce the role of financing factors that result in these inequities.

Once we have an equitable financing system, other racial factors must still be addressed. As study co-author David Himmelstein states, “Stark racial segregation persists to this day in New York’s hospitals. Our most prestigious institutions find ways to avoid Black and poor patients. And they maintain separate and unequal clinic systems. Privately insured patients get business-class care; those with Medicaid are mostly treated by interns and residents in rundown facilities and face long waits for appointments; while the uninsured are usually turned away from the elite hospitals’ clinics altogether.”

Clearly, once we have an improved Medicare for all in place, our work is not done.

Looking for a really good Obamacare replacement? Here it is

By David Lazarus
Los Angeles Times, Feb. 3, 2017

Supporters of healthcare reform may feel disheartened as President Trump and Republican lawmakers prepare to repeal the Affordable Care Act and replace it with … well, something. They can’t even agree among themselves on what the U.S. healthcare system should look like.

But there’s reason for hope, albeit a long shot.

OK, a very long shot.

Rep. John Conyers Jr. (D-Mich.) has introduced a bill that would expand Medicare to “provide for comprehensive health insurance coverage for all United States residents.”

In other words, it would build on the successful single-payer insurance program that already covers more than 55 million people and bring the United States in line with almost all other developed nations in providing taxpayer-funded health coverage for everyone.

Needless to say, the legislation — HR 676 — has no chance of passage by the Republican-controlled Congress.

However, the fact that such a bill exists serves as a reminder that there are some in positions of power who understand the pitfalls of the U.S.’s private-sector-dominated health insurance system, and who are willing to place national interest ahead of corporate profits.

Also, some backers of the legislation think there’s at least one prominent Republican who might come around to their way of thinking.

Taking 20 million people out of Obamacare is going to help our cause. We’ve got all the arguments on our side. — Rep. John Conyers Jr. (D-Mich.)

“Donald Trump is a businessman, not a lifetime politician,” said Dr. Carol Paris, head of Physicians for a National Health Program, which represents 20,000 doctors who support creation of a U.S. single-payer insurance system. “HR 676 is a formula for good business. It makes good business sense.”

She’ll get no argument from me. A 2014 study by the Commonwealth Fund compared the U.S. healthcare system to those of 10 other developed countries, including Canada, Germany, France and Britain.

It found that the United States had by far the most expensive system in the world but trailed its peers in delivering bang for its healthcare bucks.

Administrative costs — paperwork, incompatible computer systems, interactions between doctors, hospitals and hundreds of insurers — eat up about 25% of U.S. healthcare spending.

Meanwhile, at an average of more than $10,000 per person, the United States pays more for healthcare annually than any other developed country without any significant improvement in outcome, such as longer life expectancy. The typical American can expect to live to 79, whereas citizens of other developed nations will live past 80, according to the Organization for Economic Cooperation and Development.

“International experience shows that single-payer financing systems, like the one described in Rep. Conyers’ bill, are the fairest and most cost-effective way to assure that everyone gets high-quality care,” Paris said.

Conyers, however, isn’t holding his breath.

He told me he doesn’t think Trump — whom he described as “erratic” — will suddenly embrace the common-sense advantages of Medicare for all. Nor does he think House Republicans will be flexible in their thinking.

“This is not something that they’re going to buy into,” Conyers said, “even though countries with universal healthcare find that it costs less and is healthier for people. We’re just too polarized right now.”

Nevertheless, he said he’s optimistic about the future. Conyers expects the Republicans’ replacement of Obamacare to be so troublesome that the public will grow increasingly receptive to new ideas. This will allow a case to be made for Medicare expansion.

“Taking 20 million people out of Obamacare is going to help our cause,” he said. “We’ve got all the arguments on our side.”

His bill already has 51 co-sponsors, including California’s Judy Chu, Mark DeSaulnier, John Garamendi, Jared Huffman, Barbara Lee, Ted Lieu, Zoe Lofgren, Grace Napolitano, Lucille Roybal-Allard and Mark Takano. No Republicans have signed on.

Under HR 676, “all individuals residing in the United States (including any territory of the United States) are covered under the Medicare For All Program, entitling them to a universal, best quality standard of care.”

The bill would cover primary care, emergency care, prescription drugs, medical equipment, long-term care, mental health services, dental services, chiropractic services, basic vision care and other healthcare needs.

And try this on for size: “No deductibles, copayments, coinsurance or other cost-sharing shall be imposed with respect to covered benefits.” Instead, funding would be made primarily through payroll taxes, as is already the case with Medicare and Social Security.

A 2013 analysis of an earlier version of Conyers’ legislation by Gerald Friedman, a healthcare economist at the University of Massachusetts Amherst, found that progressive federal tax payments “would cost less for 95% of households” than the current system of deductibles, premiums and copayments.

He also concluded that because of huge administrative savings and greater negotiating strength with hospitals, doctors and drug companies, a Medicare-for-all system “would make it possible to provide universal coverage and comprehensive benefits to future generations.”

This isn’t “socialism” and it isn’t “government-run healthcare.” Doctors would still be free to practice medicine as they see fit.

It’s simply a more effective and efficient way of managing healthcare risk for the entire population.

Private health insurers would battle ferociously to prevent such a change, but they wouldn’t be put out of business. Rather than providing total coverage, they’d simply shift to offering supplemental plans, as they already do. A more competitive market for added coverage would only benefit Americans.

It’s widely believed that Republican replacements for the Affordable Care Act will include health savings accounts coupled with high-deductible plans from private insurers, as well as high-risk pools for people with pre-existing conditions that all but guarantee limited coverage and sky-high premiums.

Think about that. Now think about the broad coverage featured in Conyers’ bill being available for less than what you pay now.

Think about having the same coverage regardless of your job (or lack thereof). Think about the number of people without insurance dropping to zero.

Think about Americans finally enjoying the same healthcare benefits as the rest of the developed world.

What’s not to like?

http://www.latimes.com…

The post-ACA insurance market is working better for consumers, but how much better?

New Health Insurance Survey: Post-ACA, Market Works Better For Consumers Buying Plans On Their Own; Fewer People Postponing Care and Medications Because of Cost

The Commonwealth Fund, February 1, 2017

The health insurance market has been working better for consumers buying coverage on their own, especially those with health problems, since the Affordable Care Act (ACA) took effect. According to a new Commonwealth Fund report, the percentage of people who shopped for insurance on their own who could not find an affordable plan dropped from 60 percent in 2010 to 34 percent in 2016.

“Before the Affordable Care Act, it was often extremely hard for people not covered through an employer to buy coverage,” said Sara Collins, vice president for Health Care Coverage and Access at the Commonwealth Fund and the report’s lead author. “Many were routinely turned down, told a preexisting condition would not be covered, or charged higher rates because of an illness. This survey finds that since the law was passed the individual market has changed dramatically. Now, millions of people are finding and buying affordable plans that provide coverage meeting their needs.”

The survey finds that since the ACA’s passage in 2010, people are more likely to say they can get the health insurance and care they need:

* In 2012, 80 million adults said they went without health care or medication they needed because of the cost, compared to 63 million in 2016.

* In 2010, more than two of five (43%) adults buying plans on their own said they found it difficult or impossible to find a plan that fit their needs, compared to one-quarter (25%) in 2016.

* In 2010, more than half (53%) of adults with health problems said it was difficult or impossible to find a plan that fit their needs; this fell to one-third (31%) in 2016. For people with low incomes, the share reporting such difficulty fell by about half, from 49 percent in 2010 to 26 percent in 2016.

* In 2012, 29 percent said they did not go to a doctor when they were sick because of the cost, compared to 20 percent in 2016. In 2012 over one-quarter of adults (27%) said they did not fill a prescription because of the cost, compared to one-fifth (19%) in 2016.

* In 2016, the share of adults reporting they had skipped a recommended test, treatment, or follow-up visit because of the cost fell to 18 percent, from 27 percent in 2012. And in 2016, 13 percent said they had not gotten needed care from a specialist because of the cost, down from 20 percent in 2012.

* Medical bills remain a challenge. The number of adults saying they had problems paying medical bills in the past 12 months or were paying off medical bills over time declined modestly, from 75 million is 2012 to 70 million in 2016. There are still a substantial number of people paying off medical debt over time; nearly 46 million adults reporting doing so in 2016—unchanged from 2012.

http://www.commonwealthfund.org…

Full report:
http://www.commonwealthfund.org…

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Comment:

By Don McCanne, M.D.

It is really wonderful to see the progress that we have made with the Affordable Care Act in ensuring affordable health care for all. To understand better how far we have come, let’s select from this report the findings of where we stand today:

* Only 63 million adults say they went without health care or medication they needed because of the cost

* Only 25 percent of adults buying plans on their own say they found it difficult or impossible to find a plan that fit their needs

* Only 31 percent of adults with health problems say it was difficult or impossible to find a plan that fits their needs

* Only 26 percent of adults with low incomes and health problems say it was difficult or impossible to find a plan that fits their needs

* Only 20 percent of adults say they did not go to a doctor when they were sick because of the cost

* Only 19 percent of adults say they did not fill a prescription because of the cost

* Only 18 percent of adults reported they had skipped a recommended test, treatment, or follow-up visit because of the cost

* Only 70 million adults said they had problems paying medical bills in the past 12 months or were paying off medical bills over time

* Only 46 million adults are currently paying off medical debt over time (unchanged from 2012)

Is this really good enough? Should we vigorously defend the status quo supported by the Democrats? Or should we support Republican policies that would replace the Affordable Care Act – policies that would shift more costs to patients, inevitably increasing the exposure of adults to these difficulties they now face? These are the options currently under debate in Congress.

There is another option. We can reduce all of those numbers to ZERO simply by enacting and implementing a well designed single payer national health program – an improved Medicare for all. And it wouldn’t cost the nation any more than we are already spending. Congress and the President need to hear from us.

Trumping Obamacare with Medicare-For-All

By Paul F. deLespinasse
Statesman Journal (Salem, Ore.), Feb. 2, 2017

Donald Trump promises to “repeal and replace” Obamacare and has said that replacement and repeal should be simultaneous. Let’s hope he insists on simultaneity. Repeal would be delayed since there is no Republican consensus on a replacement. But delay is preferable to the mess caused by a mere repeal.

Obamacare  insured millions of additional people. And some parts are very popular, especially its ban on denying insurance to people with preexisting conditions. But insurance markets would be destroyed if this ban is retained but the most unpopular part of Obamacare (mandatory purchase of insurance) is not also retained.

The obvious way to escape from this dilemma is to enact a single-payer system — an improved Medicare-For-All — financed by general taxes. Nobody would have to buy insurance, but everyone would be insured. People would not have to choose between incomprehensible policies with different coverage and doctor “networks.” Patients would no longer “churn” between different types of insurance, each with its own network, as incomes change. People would no longer have to document their finances in order to qualify for subsidies.

Medical providers would no longer need huge staffs — now costing about $80,000 per year for every doctor — to bill dozens of insurance companies.

Conservatives bemoan duplicated government programs and administrative bloat. But we now have separate government agencies for insuring poor people, retirees, veterans and Native Americans. We also have private bloat: back-room staffing at medical providers and huge staffs that insurance companies use to figure out reasons for not covering people.

This presents an opportunity for Donald Trump (a world-class opportunist). Imagine him explaining to his supporters (often not economically advantaged) why a system covering medical bills with only nominal co-payments, no deductibles and no out-of-network doctors would be strongly in their interest. Or explaining to black Americans how an improved Medicare-For-All would do more for minorities than any other conceivable government program.

If Trump were to propose Medicare-For-All, Democrats in Congress would support him, and so would many of the voters who supported him.

Medicare-For-All would not require establishment of a new bureaucracy since Medicare is already a going concern. Indeed, it would allow elimination of the organizations now covering the poor, veterans and Native Americans.

Trump, knowing how to get national attention, will be uniquely able to explain why inevitable criticism of his proposal by the medical/pharmaceutical insurance complex is self-interested and misleading. He can explain why taxes necessary to pay for Medicare-For-All will cost average (and especially below-average) Americans less than they are already paying (directly and indirectly) for medical care.

Although most congressional Republicans have opposed single-payer, if Trump convinces public opinion, many Republican congressmen would have to vote for it. If single-payer failed to pass, Trump could urge voters to unseat those who opposed it in 2018.

It took red-baiter Richard Nixon to restore U.S. relations with China. Can a Republican president bring us Medicare-For-All?

Paul F. deLespinasse of Corvallis is professor emeritus of political science and computer science at Adrian College. He can be reached at pdeles@proaxis.com.

http://www.statesmanjournal.com…

‘The Single-Payer Healthcare Fight Goes National … Again’

By Lynn Marie Morski, M.D.
IVN (Independent Voter Project), Feb. 2, 2017

One of the more notable tenets of Bernie Sanders’ platform during his campaign for president was a “Medicare-for-all” single-payer healthcare system.

This was not the first time that a government-run, public option has received national attention. Many may recall that the initial versions of the Affordable Care Act had included a public option, but it was voted down in the Senate finance committee and removed from the bill.

In 2013, House Democrats introduced H.R. 261, the “Public Option Deficit Reduction Act.” The act would have amended the Affordable Care Act to add a public option. It would have lowered premiums by 5-7%, which they hoped would put pressure on private insurance companies to lower premiums. The Congressional Budget Office had estimated enacting the bill would cut the budget deficit by $104 billion over ten years. It didn’t make it out of the Subcommittee on Health.

Since that time, it appears that Americans have had varied opinions on single-payer or “Medicare-for-all” systems. Many don’t understand the concept fully, and others are turned off by the thought of paying more taxes or losing their current insurance. Often, the facts that additional taxes may be offset by lower costs for medical visits and a single-payer system would involve much lower administrative costs go unnoticed.

But despite the fact that neither H.R. 261, nor Bernie Sanders’ Medicare-for-all system came to fruition, it appears that the desire for a single-payer system persists. On January 24th, Congressman John Conyers (D-MI-13) reintroduced HR 676, a bill aimed at expanding Medicare to provide universal coverage for all Americans, a bill he had initially introduced in 2003 and reintroduced in 2009, 2011 and 2013. The bill currently has 51 cosponsors.

Healthcare-NOW, an organization that advocates for a single-payer system, gave a detailed rundown of the bill’s highlights on their website, but most notably it would cover every American citizen, and the new national healthcare service would negotiate prices with physicians, hospitals, and pharmaceutical and medical supply companies. They estimate the savings to the United States at $387 billion dollars annually.

So while a number of states have had their own failed initiatives for statewide single payer systems, proponents of universal healthcare can be encouraged by the fact that there are a number of members of Congress who still think single-payer is an option worth fighting for at a national level.

Lynn Marie Morski is a physician at the Veterans Administration and an adjunct professor of health law at Thomas Jefferson School of Law.

https://ivn.us…

Hospitals in New York City segregated by race and insurance status: new study

Black and low-income New Yorkers largely shut out of major academic hospitals

New study finds substantial segregation in New York’s hospital system, but less in Boston’s

FOR IMMEDIATE RELEASE, Friday, February 3, 2017
Contact: Mark Almberg, PNHP communications director, 312-782-6006, mark@pnhp.org

Few Black New Yorkers receive care in New York City’s elite private academic medical centers (AMCs), according to a study published Thursday [Feb. 2, at 11:30 p.m. EST] in the International Journal of Health Services. Uninsured and Medicaid patients are also markedly underrepresented at the city’s major academic hospitals. In contrast, patients in Boston’s hospitals are much less segregated by race or health insurance status.

The study analyzed official data on all adults discharged from hospitals in New York City (NYC) in 2009 and 2014, and in Boston in 2009. It found that in NYC in 2014, Blacks accounted for only 18 percent of AMC patients, but nearly one-third of patients in the city’s other hospitals. (Findings were similar in 2009). Similarly, only 22 percent of New York City’s AMC patients had Medicaid and only 1 percent were uninsured, versus corresponding figures of 42 percent and 4 percent at city’s non-AMC hospitals.

The study was carried out by researchers at City University of New York at Hunter College (CUNY), Boston Medical Center, and Harvard Medical School. Four of the authors are academic physicians who have cared for patients at multiple hospitals included in the study.

Other study findings include the following:

  • Even after controlling for their lower-quality insurance, Black New Yorkers were still only half as likely as whites to get their care in AMCs.
  • The Index of Dissimilarity (a measure of system-wide segregation) for Black patients was 0.52 for NYC hospitals, indicating moderately high segregation. That figure means that 52 percent of Black patients in NYC would have to switch to hospitals that now serve predominantly white patients to achieve the full integration of the system. In Boston’s system, the Index of Dissimilarity figure was 0.33.
  • Compared to privately insured patients, Medicaid patients were three times less likely, and uninsured patients five times less likely, to be treated at New York City’s major academic hospitals. While Medicaid and uninsured patients accounted for nearly half (46 percent) of all patients at non-AMC hospitals in NYC, they made up less than one-quarter of inpatients at NYC’s AMCs overall, and less than 10 percent at one-third of the AMCs.
  • Conversely, privately insured New Yorkers were more than twice as likely to get care at AMCs compared to other NYC hospitals. In Boston, Medicaid enrollees and uninsured patients were just as likely to be treated at an AMC as at a non-AMC hospital (14 percent and 1 percent for both).

The authors state: “Academic medical centers play a unique role. … They provide specialized expertise across a range of clinical services. Many AMCs are ranked among the top hospitals in the country, and patients treated at AMCs are more likely than other patients to receive treatments using the latest technologies and care adhering to current clinical guidelines.”

They note that while good non-AMC hospitals can provide excellent care for many illnesses, the specialized care available at AMCs is especially important for patients with very complex and rare conditions.

The authors posit that “the extensive network of public hospitals in NYC relieves pressure on that city’s AMCs to care for disadvantaged patients.” But they note that the public hospitals face a financial crisis and are often under-resourced, while several of the AMCs regularly generate multimillion-dollar surpluses on their balance sheets.

All of the AMCs in Boston and NYC are nonprofit hospitals and enjoy tax exemptions worth tens of millions of dollars. In exchange, they are expected to provide community benefits, including caring for Medicaid and uninsured patients.

Roosa Tikkanen, lead author of the study who is currently a policy analyst at the University of Massachusetts Medical School, said: “All of New York’s academic medical centers receive millions of dollars from the state’s ‘Indigent Care Pool,’ but many of them provide little care to uninsured or Medicaid patients. Some of them are specialty hospitals that receive their patients mainly through referrals from private doctors, and these patients tend to be privately insured. This contributes to the low volume of Medicaid and uninsured patients at AMCs. However, even these specialty hospitals could do more to meet their community benefit expectation and earn their tax breaks, especially since they already have greater financial resources than the city’s public hospitals do.”

Study co-author Dr. David Himmelstein, an internist, distinguished professor at CUNY’s Hunter College, and lecturer at Harvard Medical School who has practiced at public and AMC hospitals in New York and Boston, said: “Stark racial segregation persists to this day in New York’s hospitals. Our most prestigious institutions find ways to avoid Black and poor patients. And they maintain separate and unequal clinic systems. Privately insured patients get business-class care; those with Medicaid are mostly treated by interns and residents in rundown facilities and face long waits for appointments; while the uninsured are usually turned away from the elite hospitals’ clinics altogether.”

Senior author Dr. Karen E. Lasser, an internist at Boston Medical Center and associate professor of medicine and public health at Boston University Schools of Medicine (BUSM) and Public Health (BUSPH), said, “This study highlights the issues that academic health centers need to address in order to provide the highest level of care to all patients, regardless of race, ethnicity, or health insurance coverage.”

***

“Hospital payer and racial/ethnic mix at private academic medical centers in Boston and New York City,” Roosa Sofia Tikkanen, M.P.H., M.Res., Steffie Woolhandler, M.D., M.P.H., David U. Himmelstein, M.D., Nancy R. Kressin, Ph.D., Amresh Hanchate, Ph.D., Meng-Yun Lin, M.P.H., Danny McCormick, M.D., M.P.H., Karen E. Lasser, M.D., M.P.H. International Journal of Health Services, published Online First, Feb. 2, 2017, at 11:30 p.m. EST. doi: 10.1177/0020731416689549.

A copy of the full study is available to media professionals upon request from Mark Almberg at mark@pnhp.org  or 312-782-6006.

Disclosures: This research project was supported in part by grants from the New York City Department of Health and Mental Hygiene; the Rx Foundation; National Institutes of Health/National Heart, Lung, and Blood Institute (U01HL105432); and the Margaret Mahoney Fellowship at the New York Academy of Medicine. The study does not necessarily reflect the views of those grantors, nor Harvard Medical School, nor Boston Medical Center, which provided administrative support. Two of the authors, Himmelstein and Woolhandler, co-founded Physicians for a National Health Program (www.pnhp.org), a nonprofit physicians organization that supports a single-payer national health plan. PNHP had no role in funding or otherwise supporting the study.

Covered California works really well, except for all the headaches

Headaches Persist As Covered California Enrollment Nears End

California Healthline, January 31, 2017

Covered California’s fourth annual open enrollment period, set to end Tuesday, has been rocky for many consumers.

During this period, two Covered California errors have affected roughly 50,000 policy holders, leading to higher-than-expected premiums or the potential loss of their tax credits:

  • Covered California discovered late last year that about 24,000 policy holders hadn’t provided consent for the agency to verify their income, even though the agency thought they had. Without that consent, thousands of consumers lost their 2017 tax credits, at least temporarily.
  • Covered California gave insurers the wrong tax credit information for about 25,000 policy holders, resulting in inaccurate bills. In most cases the recalculated premiums are higher than consumers had initially anticipated.

Those mistakes are in addition to ongoing challenges, including Covered California website glitches, complicated password resets and the often-fraught interaction between Covered California and Medi-Cal, the state’s health coverage program for low-income residents.

Covered California Executive Director Peter Lee said the agency is contacting enrollees to fix the problems. “No one’s perfect. Anything of the scale we’re doing is going to have some problems along the way,” he said at the agency’s most recent board meeting.

Emily Bazar, California Healthline columnist and senior correspondent, recently appeared on the “McIntyre in the Morning” show on KABC AM 790 in Los Angeles to discuss these problems and their effect on consumers.

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“McIntyre in the Morning” show on KABC AM 790

Doug McIntyre:  This story is so complicated, and I have a BA in English. I still don’t feel really competent of the facts on this so please be kind with me as we go through this because it’s complicated; it’s really complicated.

Emily Bazar:  You’re right. It’s incredibly complicated. It’s been very difficult for people since 2013, 2014 when this began – to figure out how to apply, how to use their insurance, what the requirements are to avoid the tax penalties – it’s been very complicated.

…

Emily Bazar:  It seems in the writing of these things that the day to day effect on people  – the effect that it has on their lives, their time, their pocketbooks – is not taken into account as much as it should be.

http://californiahealthline.org…

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Comment:

By Don McCanne, M.D.

Peter Lee and his staff at Covered California quite appropriately have received accolades for their great work in implementing the Affordable Care Act. It has not been without glitches, such as those in this article, but that should only be expected in a system with such great complexity. As Emily Bazar states, “It’s incredibly complicated.”

But wouldn’t an improved Medicare that covered everyone because of its massive size also be incredibly complicated? Actually not necessarily. A well designed single payer national health program is the epitome of simplicity in the financing of a health care system. The administrative complexity that uniquely characterizes our fragmented multi-payer system would be eliminated by the administrative simplicity of a single payer system. Improving Medicare includes revising administrative functions to operate smoothly within a single system as opposed to being only one player that cannot introduce efficiency into the infrastructure of our complex multi-payer system.

The large size – covering 324 million people – is not a reason to duck out of implementing a universal program. Rather our financing system screams out for simplicity and efficiency – precisely why we need to enact and implement an improved Medicare for all.

Size is not the problem. Design is. Emily Bazar says that we need to take into account “the day to day effect on people  – the effect that it has on their lives, their time, their pocketbooks.”

‘Access’?

By Jack Bernard
The Ledger-Enquirer (Columbus, Ga.), Letters, Feb. 1, 2017

Do not be fooled by the rhetoric coming out of some of the congressional leadership and specifically Rep. Price, nominee for HHS secretary, and Speaker Ryan. When you hear them say “access to coverage” think about unaffordable premiums. Access clearly does not mean that all taxpayers will have health care insurance…or truly be able to pay for offered policies.

Although there are cost issues with the ACA (Obamacare), there will be much greater cost increases if it is repealed with no coverage assistance. Currently, 85% of those enrolled in the ACA get significant assistance.

In every plan coming out of Congress, these subsidies are abolished and replaced with mechanisms whereby citizens put away their own money to pay for premiums. That is fine for the wealthy. However, without the ACA subsidies, working people simply can’t afford health insurance under these proposals. Especially the elderly who will pay five times as much as younger people under Speaker Ryan’s proposals.

And, if no replacement is put forth, 18 million of our citizens will immediately lose coverage, rising to 32 million over time, per the non-partisan Congressional Budget Office.

If we take the politics out of this situation, the solution is clear: expand Medicare over time to cover all Americans. Both Obama and Trump have stated as much. The obstacle is the insurance and pharmacy lobbies.

Jack Bernard resides in Peachtree City.

http://www.ledger-enquirer.com…

Dembrow Is Hopeful Single Payer Option Can Move Forward

New legislation would create an interim task force to delve into creating such a system

By Diane Lund-Muzikant
The Lund Report (Portland, Ore.), Feb. 1, 2017

The recent study by the RAND Corp. that looked at the feasibility of a single payer system has given renewed hope to advocates, while concerns are being raised about how such a system would play out financially.

Sen. Michael Dembrow (D-Portland), whose legislation gave the impetus for the RAND study, is fully aware that more work lies ahead. He’s making arrangements for the principal investigator who conducted the study to meet with the healthcare committees later this month to discuss the findings, and intends to draft legislation to create an interim committee that can take a deep dive into this issue after the session adjourns.

“Broadly speaking, the study gives us a lot to work with; I’m not sure I agree with all their conclusions, but I think it’s an important first step,” Dembrow told The Lund Report. “The RAND Corporation wanted to come up with something that looks soberly at the positives and the negatives in a way that provides some direction for us and to look at what factors to take into consideration when crafting something that works for Oregon. That’s why they’re coming to Oregon to talk about their assumptions and recommendations; it’s part of their contract.”

RAND concluded that more people could be covered under a single payer system with a higher quality of care for the same amount of money that’s being spent currently. Their analysis also concluded that providers would see their reimbursement levels decrease, which may not necessarily be true, said Dembrow because there would be fewer administrative hurdles under a single payer system.

Now that the Republicans control the federal government, the timing of this study is creating more urgency since Medicaid could be turned into a block grant program. “Oregon needs to figure out what’s working best, and that could give rise to a single payer system,” Dembrow said.

He also doubts there was any interference from Healthcare Management Associates, whose managing principal, Tina Edlund, had been the acting director of the Oregon Health Authority prior to Lynne Saxton. HMA consulted with RAND on the status of the coordinated care organizations that provide care to more than 1 million Oregonians. “RAND wanted to look at how the CCOs are working and how different processes could interface,” Dembrow added.

Advocates React

RAND made incorrect assumptions about the administrative savings, according to Charlie Swanson, legislative committee chair for Health Care for All Oregon Action, who also sits on their board. Their researchers only looked at the savings from insurance companies and not provider offices, concluding that a single payer system would save 11 percent of costs. However, they referenced $600 million rather than the $4 billion that would have been realized from Oregon’s $36 billion total in 2015.

Healthcare costs in the state are expected to reach $46-48 billion by 2019, according to the Kaiser Family Foundation.

“RAND either shortchanged or misunderstood the administrative savings,” Swanson said.

RAND was given a difficult task to figure out what the federal legislation would permit states to do, and there’s an enormous grey area, particularly with respect to ERISA which prevents states from regulating employer benefits to create a universal healthcare plan, according to Dr. Sam Metz, a long-time advocate of a single payer system, who’s a member of Oregon Physicians for a National Health Program and a founding member of Mad as Hell Doctors.

He’s hopeful legislators will take the time to review the study in-depth, and realize that healthcare reform needs to move toward a universal system.

“Regardless of what we think of CCOs, Oregon’s overall spending in healthcare has not gone down, and there’s not been a reduction in medical bankruptcies, or an improvement in overall public health,” Metz said. “Medicaid is not a model for universal care. We know Oregon is uniquely vulnerable to federal policy because we have a larger Medicaid burden. We can provide better care to more people without requiring more money in a single payer system.”

But change doesn’t come easy when Oregon is spending close to $40 billion on health care, which is the largest single sector of its economy, he added. “When we change how that money flows even a little, some people are going to lose millions of dollars, and they’re going to make more noise than the people who gain money. Changing this industry and the health of Oregonians will require substantial leadership within the industry at great risk to itself, and will require a critical mass activated voters to tell legislators they have their back when it comes to the next election.

“Voters don’t have to solve the impending healthcare crisis, but they need to tell legislators to find the right answers. In the U.S. today, more people die of treatable diseases because don’t have money for treatment than are shot to death, and the loss of healthcare is a greater risk to our families than foreign-born or native-born terrorists,” Metz added.

RAND also concluded that providing more care to more people would lead to congestion in the system. “This congestion the RAND report warns us about sounds like a giant economic stimulus for Oregon; it means there’s a new need in Oregon not just for neurosurgeons, but for nurse practitioners, home health aides, workers in hospital cafeterias and construction workers to build new clinics,” Metz said.

https://www.thelundreport.org…

Committee of Interns and Residents – Open Letter to the President

Statement from CIR – Committee of Interns and Residents

We won’t let Trump immigration actions stop us from caring for all patients

In response President Trump’s January 25 announcement of a series of executive actions on immigration, the national resident physicians’ union, the Committee of Interns and Residents, issued the following statement:

As a union of 14,000 resident physicians, we suffer from acute repercussions of President Trump’s actions on immigration on many fronts. They are not merely matters of security and law enforcement. Their effects are wide-ranging and endanger the public’s health, the healthcare safety-net, the wellbeing of physicians who are immigrants, and the fabric of our communities.

Many of our resident physician colleagues made great sacrifices and moved to the United States to be of service to our patients and our communities. Among our members are brilliant scientists, asylum-seekers, and refugees from environmental disasters and war. These are the faces of immigration in America, and they are saving lives every day.

Each of us took an oath of service, and we are in this profession to heal the survivors of violence and trauma, and those afflicted by illness. We are committed to providing healthcare to all, and treating each patient with dignity and respect, regardless of where they come from. This is an American value and does not change with a new administration in Washington.

Those American values are at odds with President Trump’s actions. The executive actions will intensify criminalization of immigrants, pull local law enforcement into his “deportation force,” endanger safe havens, and tear communities apart. It will cause patients in dire need to shun local hospitals and clinics where a police officer is stationed out of fear for themselves or their families, turn a trip overseas for a foreign-born physician into a nightmare of uncertainty, and threaten to withdraw millions of critically-needed and properly allocated federal healthcare dollars from our cities, counties, and states.

Simply put, lives will be put at risk by these actions.

http://www.cirseiu.org…

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CIR has prepared an Open Letter to the President informing him of “severe adverse effects and interruptions of care for many of our most vulnerable patients, particularly the underserved in health professional shortage areas.” The letter requests him to rescind this order. Health care students, professionals and others concerned are invited to sign the Open Letter at the following link:

https://goo.gl/forms…

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Comment:

By Don McCanne, M.D.

I signed it.

Healthcare solution: Make Medicare available to all ages

By Carol Paris, M.D., and Jack Bernard
The Citizen (Fayetteville, Ga.), Jan. 31, 2017

We read the letter by David Browning and agree with many of the points he made. It is good to see taxpayers waking up to the fact that Medicare for All (otherwise known as single payer) will go a long way towards solving both our access and cost containment problems.

This was a close election, reflecting a divided nation. This is not new; it happens every election cycle, by design.

This time around, the divisive finger-pointing was more extreme, volatile and ideologic than ever before, reflecting the lengths the “designers” will go to keep us, the American people, fighting amongst ourselves. Meanwhile, the designers (aka Corporate America) are using the congressional and presidential influence they bought and paid for to advance their own agenda.

Examples abound but we focus on one particularly dangerous example: the nomination of Georgia Rep. Tom Price for Secretary of DHHS.

Price is owned by virtually every wealthy right-wing interest group and now he is positioned to accomplish their bidding: nothing less than the complete privatization of Medicare.

Make no mistake, a vote for Price is a vote against Medicare. It is a vote for profiteering health insurance industry executives who keep getting richer as our senior citizens get poorer.

Their bidding doesn’t stop at privatizing Medicare. Oh no, it also targets the 22 million poor and working class, mostly white and lacking a college education, who will lose health insurance when the ACA (otherwise known as Obamacare) is gutted. They will rejoin the 30 million the ACA failed to cover. And the rich get richer.

But, despite his unsuitability for the DHHS position, Rep. Price is just a symptom of the underlying problem.

In past years, both Democratic and Republican Presidential candidates have acknowledged that the only truly universal, cost-effective plan for healthcare reform is a “national health program”, i.e., expansion of Medicare to cover all citizens. A Kaiser Family Foundation poll in 2015 revealed that 58 percent of the public support a single payer national health plan. So what is the obstacle?

Follow the money. The obstacle is corporate America.

How long will we, brothers and sisters, middle class and poor, white, black, brown, liberal, conservative, religious and nonreligious, straight and LGBTQ, continue to be divided and duped by corporate American design?

And how long will our elected officials in both parties allow themselves to be bought and paid for, also by corporate American design?

We don’t recommend waiting for our elected officials to change; we do recommend that each and every one of us open our eyes and see that we have been duped. Then, we can come together, the united people of America, and enact legislation that serves our needs: Let’s start with Medicare for All, a national health program.

Carol A. Paris, M.D., is president of Physicians for a National Healthcare Program (PNHP), which has 20,000 members nationwide. She resides in Nashville, Tenn. Jack Bernard is a retired senior vice president with a healthcare corporation and the former Director of Health Planning for the state of Georgia. He resides in Peachtree City, Ga.

http://thecitizen.com…

Private Medicare Advantage patients use less care, giving MA plans greater margins

NBER Working Paper No. 23090: Healthcare Spending and Utilization in Public and Private Medicare

By Vilsa Curto, Liran Einav, Amy Finkelstein, Jonathan D. Levin, and Jay Bhattacharya
National Bureau of Economic Research, January 2017

Abstract

We compare healthcare spending in public and private Medicare using newly available claims data from Medicare Advantage (MA) insurers. MA insurer revenues are 30 percent higher than their healthcare spending. Healthcare spending is 25 percent lower for MA enrollees than for enrollees in traditional Medicare (TM) in the same county with the same risk score. Spending differences between MA and TM are similar across sub-populations of enrollees and sub-categories of care, with similar reductions for “high value” and “low value” care. Spending differences primarily reflect differences in healthcare utilization; spending per encounter and hospital payments per admission are very similar in MA and TM. Geographic variation in MA spending is about 20 percent higher than in TM, but geographic variation in hospital prices is about 20 percent lower. We present evidence consistent with MA plans encouraging substitution to less expensive care, such as primary rather than specialist care, and outpatient rather than inpatient surgery, and with employing various types of utilization management. Some of the overall spending differences between MA and TM may be driven by selection on unobservables, and we report a range of estimates of this selection effect using mortality outcomes to proxy for selection.

From the Conclusion

We have compared healthcare spending and utilization in public and private Medicare. This setting provides a rare opportunity for a “side by side” comparison of public and private health insurance systems operating on a similar scale, for the same population, in the same markets, and with the same providers. Novel data from the Health Care Cost Institute on the healthcare claims of MA enrollees allow us a rare look inside the “black box” of healthcare utilization and spending in MA.

We find that MA insurer revenues are 30 percent higher than their healthcare spending. Healthcare spending for enrollees in MA is 25% lower than for enrollees in TM in the same county and risk score.

The lower spending by MA enrollees is entirely due to lower healthcare utilization. Prices appear similar in MA and TM. Where we can most directly measure this – the price of an admission for a given DRG at a given hospital – we estimate that average prices in MA are 1.1% higher than in TM. Reductions in utilization appear similar both for types of care where there is concern about “over use” (e.g. imaging and diagnostic tests) and where there is concern about “under use” (e.g. preventive care).

We provide suggestive evidence for some of the potential channels by which MA may reduce healthcare utilization for enrollees. We find that utilization is lower in MA but that, conditional on an encounter, spending per encounter is similar or slightly higher in MA. This suggests that MA manages to restrict utilization on the margin to sicker individuals. Relatedly, individuals discharged from the hospital are much more likely to be sent home – and less likely to be sent to post-acute care facility – if they are enrolled in MA rather than in TM. We also find evidence consistent with substitution to less expensive types of care in MA: differences in specialist visits are much larger than differences in primary care visits, and while inpatient surgery rates are lower in MA, outpatient surgery rates are higher.

Finally, in light of the widespread interest in geographic variation in healthcare spending in TM, and recent work on geographic variation in commercial (under 65) private insurance, we explore similar comparisons in MA. Although geographic variation in spending in TM is often viewed as a reflection of the inefficiencies in a public health insurance system, we find similar – in fact slightly larger – geographic variation in spending in MA compared to TM. And while recent work has emphasized the much greater geographic pricing variation in private commercial insurance than in TM, we find similar – in fact slightly smaller – geographic variation in pricing in MA compared to TM.

One natural question these findings raise is their implications for MA insurers and consumers. For insurers, our estimates from MA data indicate that their revenue exceeds their healthcare expenditures by $177 (about 30%) per enrollee-month. An important area for further work is to examine how this may be dissipated through other costs, such as the administrative costs of providing the insurance and the marketing costs of attracting enrollees. A related and important question is whether and how competitive pressures affect the MA market.

Implications for consumers are more elusive, since the elements of their objective function are not as straightforward to define or measure. A simple revealed preference argument would suggest that consumers who choose MA are better off in it. Other inferences are harder to make. Quality of the healthcare experience is difficult to assess; our measures of preventive care point to reductions there that are similar in magnitude to those for other forms of care. We calculated that the mean actuarial benefit to consumers (i.e. rebate to consumers as measured in the bid data) was $51 per enrollee-month, but, of course, the rebate may be valued differently from its actuarial value, and MA plans have other attributes that will affect consumer surplus, such as limited networks. The implications of privately provided Medicare for both consumers and producers is an important area for further work.

http://www.nber.org…

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Comment:

By Don McCanne, M.D.

Although services provided by the traditional Medicare (TM) program and the Medicare Advantage (MA) plans are priced about the same, the health care expenditures of MA plans are about 30 percent lower than their revenues. The difference is lower utilization by patients of MA plans.

Although some would like to claim that the lower utilization is due to greater efficiency of the managed care organizations as opposed to the government plan, the data is highly suggestive that MA plans do what we already knew they do – they enroll healthier, less expensive patients who do not require as much care.

What are the private MA plans doing with the 30 percent of revenues that are not spent on health care? The authors suggest that further study might be warranted of their administrative costs and marketing costs of attracting (healthy) enrollees (not to mention high executive compensation and shareholder return), but we already know that is where the excess payments are going. The payments are excessive because they care for healthier patients than those in the traditional program, while gaming risk adjustment to receive higher capitation fees as if their enrollees were sicker than they actually are.

We need an improved Medicare to cover all of us, and one of the first improvements should be to get rid of the private Medicare Advantage plans that are wasting so much of our taxpayer dollars.