PNHP

The Lancet interviews Dr. David Himmelstein on the U.S. election results

The Lancet interviews Dr. David Himmelstein on the U.S. election results

The following is an unofficial transcript of an interview that Dr. David U. Himmelstein gave to Richard Lane, web editor at The Lancet, on Nov. 10, 2016. Dr. Himmelstein is professor of health policy and management at the City University of New York School of Public Health and lecturer in medicine at Harvard Medical School. He is co-founder of Physicians for a National Health Program. You can listen to the interview at this link at The Lancet.

Richard Lane, The Lancet: Welcome to the latest podcast from The Lancet. I’m Richard Lane and it’s Friday, November 11th. This podcast comes to you from New York City. We’re in the United States because of the election, and what an extraordinary, dramatic election it has been. And I’m joined on the line by Dr. David Himmelstein for this podcast. David, welcome. You’re a health policy expert. We want to talk a lot about health care. But first of all we’ve got to talk about the extraordinary night that was Tuesday evening. Can I get your reaction to the election? Did you have any sense that this might happen?

David Himmelstein, M.D.: Well, we were worried that it might happen after Brexit and other events elsewhere. And frankly Trump’s performance in the primaries gave some clue that the polls might be off. So I didn’t expect it, but I was worried that it might happen.

RL: If you just put the news on – I was listening to CNN this morning in my hotel room – one of the first things that people are talking about, post-election, is what is Trump going to do. And one of the first things you hear mentioned is he’s going to do what he said he’s pledged to do, which is to repeal and replace Obamacare. So before we get some of the nitty-gritty of what that might mean – as a health policy expert, and you’ve been working in this field for many, many years – you must feel despondent.

DH: Well, we’ve made some progress. Surely the Affordable Care Act, or Obamacare, fell short of what we might have hoped for, but to simply roll it back, which is really the only idea that we’ve heard from Trump thus far – he says he’s going to replace it, but we have no sense of what he’s going to replace it with – rolling it back will be a health policy and public health disaster, I fear.

RL: Before the election, I tuned into a Republican rally at which Trump was speaking, but the person who did most of the talking was Mike Pence, who’s obviously going to be vice president with him. And at this Republican rally – this was on November 1st, which was the first day of the latest enrollment session for the Affordable Care Act for the insurance markets – each Republican, but particularly Mike Pence, was very, very strong that Obamacare was something that was wrong in their eyes and they wanted to return to what Mike Pence referred to as “the good old American way of doing things.” In other words, for health care, letting the private market take it out. Is that really what is going to happen? Because just the legal framework of creating the Affordable Care Act, which of course underpins Obamacare – to undo that would be a massive operation. Surely, whatever they come up with, Republicans next year, they are going to have to retain some elements of the Affordable Care Act, aren’t they?

DH: Well, they’ve said they’ll retain a few of the peripheral aspects of the Affordable Care Act, but its essence, we see, hear and think, they plan to simply do away with. That would throw about 20 million people out of insurance that they’ve newly acquired since the Affordable Care Act. We should say that even after the Affordable Care Act about 29 million people remain uninsured in the U.S. So adding 20 million to that would bring us back to the 49 million or so that were uninsured before the Affordable Care Act was passed. And that’s, I would say, unacceptable. But apparently Mr. Trump and Mr. Pence are prepared to accept it.

RL: So do you actually think – I mean this is this is a key question in the news media this morning, and we do appreciate it’s only just over 24 hours since we’ve had the election resolved – is your expectation that the 20 million people who are brought into insurance through Obamacare are going to lose their rights? They’re actually going to reverse that, rather than say, “OK, well you guys have got it, but we’ll make changes for any future changes to the insurance markets.”

DH: Well, we don’t really know, but I fear that that is what they have in mind. Much of the additional coverage was from an expansion of the Medicaid program, which is the program that’s administered by our state governments for very poor people. And the federal government under Obamacare had given very large additional funds to the state governments to expand the coverage of the Medicaid program, and not to just very poor people, but to people with incomes up to 133 percent of the poverty line. That brought in some 10 or 12 million additional people. We don’t know yet what they’re going to do, but their promise is that they’re going to roll back the Medicaid expansion. Now some of the Republicans have said in the past that what they want to do is just give a block of money to the state governments and let them do what they like with it.  They could use it for Medicaid, or spend it on other things. So some states may continue the coverage expansion under the Obamacare plan. Others in fact have refused it up till now. And still others are likely to roll it back.

RL: One of the biggest problems with the implementation of the Affordable Care Act, as far as I could see as a non-American from outside, was the way it was implemented that led to some terribly bumpy things along the way, didn’t it? Just the launch of the insurance market was a disaster, with the internet systems not working. But more importantly, over and above that, and this was the political fuel that the Republicans were almost rubbing their hands with glee with at the rally in Philadelphia last week, were the rising prices of premiums, because the insurance companies couldn’t get enough people to enroll in the program. So even though the Affordable Care Act had very laudable aims to extend its reach, and it did to 20 million people, its implementation has been deeply flawed, hasn’t it?

DH: The program was deeply flawed from the outset. It was enormously complex, and really represented a compromise that was pushed by the insurance industry. Most of the additional coverage was purchased through private insurance plans and increased the revenues given to private insurers. The structure of the program, in order to try and make it work, was tremendously complex, and that’s what really created the disorder in its startup, because trying to enroll people in hundreds of different plans around the country, each with differing offers of coverage, and deductibles – the amount that one must pay before the insurance kicks in – varied from plan to plan, as did the level of co-payments (how much you pay in addition to the insurance at each visit).  Those things varied from plan to plan, so there was tremendous complexity really baked into the program. It’s quite striking in contrast to our Medicare program which is the single-payer program for the elderly. That federal government program, which started up some 10 months after its passage by the Congress back in the 1960s before we even had any computers, enrolled 99 percent of all eligible people within that 10-month window without any notable glitches or confusion. So it’s quite clear that the structure of Obamacare was deeply flawed from the outset. And, as you say, the prices of the insurance rose quite steeply because they relied largely on market forces. I think I’m not alone in saying that the market doesn’t actually work in health care and we know that the U.S., which has the most market-oriented of health care systems, has by far the highest cost of our health care system, and it is no surprise that costs rose partly because sicker people were the ones who took up the offer of the new coverage, and they’re the most expensive people.

RL: Are there any elements of Obamacare that could be retained? I have heard mention that not refusing insurance to people with pre-existing conditions. This was a really key tenet of Obamacare. I have heard that that’s going to be retained with whatever the new Republican health plan is, and of course we don’t have what it is yet.

DH: Yes, you’re right. But they’ve said they won’t fully retain the provision that one can’t be refused coverage no matter what pre-existing health conditions you have. What they’ve said is, as long as you maintain health insurance without interruption you would not be able to be refused a renewal of your health insurance coverage. Now that’s a considerable departure, in fact, because a lot of people have very temporary interruptions of their health insurance – if they’re traveling overseas or studying elsewhere or, in the case of one of my children, actually, there was a one-day interruption when she became too old to be covered under my policy, and her new policy through her university had yet to start up. So that kind of interruption would exempt the insurance companies from having to issue coverage no matter what your health.

RL: And given your role for many years – your advocacy work, looking at a single-payer system which if I know your views, I think, is based on the Canadian system, isn’t it – any discussion now about universal health coverage within this new American system political system that we will have from the beginning of next year, talk of things like a public option and universal health coverage. Are these discussions now dead in the water?

DH: We have yet to really see. Certainly among people in the health care field, they’re not dead because we see the problems each day of a health care system which has both large numbers of people uninsured and growing numbers who have coverage but still can’t afford care. The New York Times featured an article some months ago about many people who’ve gotten Obamacare coverage but couldn’t afford to use it because it carried such high deductibles, often $5,000 before your insurance began to pay for anything. We have in fact a crisis of not just uninsured Americans but insured Americans who can’t afford care. And that crisis is not going to go away, in fact it’s likely to get worse under a Trump administration. So I doubt that that discussion will long be squelched about what to do about our health care system. Oddly enough, at one point in the past, Mr. Trump himself suggested that a single-payer reform might be a useful thing. He later went back on that, as he’s gone back on many of the things that he said. We’re not sure what direction debate will take, but we’re quite sure that debate about the need – really urgent need – for reform will continue. And frankly, surveys show quite an oddity in opinion in the U.S. Among Republicans the vast majority favored repeal of Obamacare. But some two-fifths favor implementation of a single-payer program. So that sentiment for single payer is quite widely shared across the spectrum. It’s about 75 percent of Democrats and 40 percent of Republicans. But overall the vast majority of the American people would want that kind of reform. We’ll see if Washington can be shaken up enough to really give it serious consideration. In the meantime, people in many states around the country are moving forward to think about what can be done at an individual state level to improve the health care system. In New York State, where I now live, one branch of our legislature actually passed a single-payer reform proposal last year, though the other branch demurred.

RL: That’s fascinating – that notion – a slight tautology, isn’t it? Irony about the support in many quarters for a single-payer system. Would that therefore logically be just an extension of Medicaid?

DH: More likely an extension of our Medicare program, which is frankly a much more successful program than Medicaid. Medicare is a program for all of the elderly and, as with any universal programs, they tend to be better maintained than programs that segregate the poor into a separate class of care.

RL: Final question, David. We don’t yet know who’s going to be the cabinet minister for health and human services. Do you have any idea who that might be and, even if you don’t, what role is there for advocacy organizations, experts like yourself, to potentially influence the direction of health policy by the Department of Health and Human Services?

DH: We have no sense yet of whom Trump will choose for Health and Human Services secretary. But surely there will be intense advocacy efforts in the in the months ahead. We know from past research that something like a thousand people die each year for every million people who are uninsured. So uninsurance remains one of our major causes of death. And if they do indeed throw 20 million people out of coverage, we expect about 20,000 additional deaths each year. That is a public health emergency that we can scarcely ignore. And I think advocates at all levels will surely join joint efforts in a very vigorous way to try and move our health care system forward. We at this point may not be able to move back to the ACA, but we’re hopeful that we could move forward to something even better. I mean we’ve already seen on the streets of cities around the country the deep concerns of Americans who didn’t vote for Trump. And frankly among the many people who did vote for Trump, we’re likely to see very grave concerns arise as the reality of a Trump administration emerges. We know that among white middle-aged people of lower income, who were largely Trump voters, their death rates are rising in this country and many of them can’t get the care they need. We know that medical bankruptcy is extraordinarily common among people with insurance, and those problems are likely to get worse, not better. And I think that provides a very strong basis for advocacy for change. We may see a few months of hiatus in real debate, but it will emerge again.

RL: Well it’s a fascinating discussion, David. I’m very grateful for your time so soon after the election result. Dr. David Himmelstein, many thanks for talking to The Lancet.

DH: Thank you.

Audio (MP3) file:
http://www.thelancet.com/audio/us-election-reaction

Arthur Caplan: Bioethics Faces a Rocky but Navigable Road

Bioethics Faces a Rocky but Navigable Road

By Arthur Caplan
Bioethics Today, November 9, 2016

Academic bioethics has never been popular with Republicans. Libertarians dislike academic bioethics because it seems too elitist and anti-free market. Religious thinkers worry it is technocratic, soulless and crassly utilitarian. Now with Trumpism add a populist disdain for expertise, experts and the scientific method and you have a stew that means few of you reading this will find a rapt audience in Washington for many years to come.

Trump needs to appease the paleocons and religious right to get things done. This makes it likely that bioethics will be swept back into the culture wars of the Bush era — Abortion. Contraception. Sexuality. Embryo research. Gene engineering. Enhancement issues. Chimera formation. Gender reassignment. All are back on the table.

Existing oversight of human research—FDA, OHRP, etc., will be strongly challenged as too restrictive and inimical to autonomy. “Conscience” will be very much in vogue. The vaccine wars will heat up in terms of mandates and choice. Individual rights will dominate arguments favoring the public good. Public health ethics will become hugely contentious.

Trump and a GOP congress mean the end of the ACA. Academic bioethics will be more ‘oppositional’, more concerned for the vulnerable while being accused of being both elitist and overtly partisan.

In policy there will be more disrespect in government for science, ‘facts’ and scientific expertise. Worries about COI will wane.

This means a rejection of scientific consensus about climate, vaccines, evolution. The need for clinical trials to gain access to drugs or devices will be challenged — hard. The role of pollution in spoiling health will be disputed and since bioethics is not tightly connected to environmental ethics it had better rethink that gap. Scientific findings about race, ethnicity, homosexuality and gender are all likely to carry less weight. Conservative ideology and religion will be heard loudly; scientists less so. Dr. Oz will flourish. Alternative medicine will gain in influence.

A Trump presidency means the American economy will be less stable with a smaller tax base so government funding for biomedicine will slow. Government funding for bioethics will shrink even further.

Attracting the best and brightest from the world to a nation with a regime seen as hostile to scientific expertise and to diversity will be harder. Oddly, business may be a greater friend to bioethics than government.

I see tougher times for a scientifically grounded public policy in the USA. Respect for empirical methods and evidence will further slide and weaken. The notion that facts ought guide policy is now just a point of view, not a moral presumption.

Since Trump is a triumph of, like it or not, a set of values, bioethics is in for some self-assessment and tough hand-to-hand combat. If we are to endure then there is no room for elitism, snobbery, pretense or moral superiority in our future.

http://www.bioethics.net…

***

Comment:

By Don McCanne, M.D.

Perhaps most astonishing in the political division that separates our nation is that bioethics is not immune to this polarization. You would think that fundamental moral issues of right and wrong would be above it all, but, sadly, that is not the case. Arthur Caplan provides us with a perspective of the rocky road ahead.

Media’s role in healthcare debate

By Arthur Sutherland, M.D.
The Commercial Appeal (Memphis, Tenn.), Letters, Nov. 8, 2016

I have to challenge the Nov. 6 Commercial Appeal editorial that the Affordable Care Act is the best hope for universal healthcare coverage (“ACA best hope for universal coverage”).

For starters, the ACA is not an historic or signature legislative achievement for the President because it is not working. Of the 50 million uninsured people in America, 30 million are still uninsured after passing the Patient Protection, Affordable Care Act.

Also, the ACA has proven to increase insurance premiums, and even cease coverage in Memphis, Nashville, and Knoxville.  BC/BS pulled out of these markets where there was the most need for healthcare access by the poor.

The insurance industry puts profits first. That is not healthcare protection, nor is it adding affordability for the public good.

Throughout this national healthcare reform debate, the press in general has seemed to pass on the rhetoric of the insurers and large business interests. Is this lazy journalism in failing to really study the issues, or is the press protecting big business because of their advertising revenues?

The ACA  needs to be replaced with Improved and Expanded Medicare for All which would cover everyone in the USA, reduce healthcare costs, and improve the delivery of quality healthcare. Physicians, other healthcare professions, and the public are on record to support this solution.

Dr. Arthur Sutherland resides in Memphis.

http://www.commercialappeal.com/story/opinion/readers/2016/11/08/letters-editor-nov-8/93431674/

Medicare for all

By Ewell Scott, M.D.
Lexington (Ky.) Herald-Leader, Letters, Nov. 4, 2016

Kentucky’s Medicaid expansion has been remarkably successful in a number of ways. Primarily, 400,000 citizens now have health insurance. Secondarily, the commonwealth has received a huge economic boost, benefiting from federal dollars. Hospitals and providers have noted fiscal improvement.

However, we all know our health-care financing system is broken badly and is becoming unaffordable by 95 percent of us. It does not have to be that way. A single-payer plan is the answer with progressive financing. A result would be increased net disposable income for all but the very wealthy. All citizens would be covered, there would be no deductibles or co-pays. Networks of available physicians would be eliminated, profound administrative inefficiencies would disappear, employers would no longer have to provide health insurance, annual application and re-application would be rendered unnecessary.

Medicare for all is the answer.

Dr. Ewell Scott resides in Morehead, Ky.

http://www.kentucky.com/opinion/letters-to-the-editor/article112589033.html#storylink=cpy

A brief note on the defeat of ColoradoCare

2016 U.S. election results

By Associated Press
Updated Nov. 10, 2016

Amendment 69: ColoradoCare

100% reporting

Yes: 509,629 (20.6%)

No: 1,964,755 (79.4%)

***

Comment:

By Don McCanne, M.D.

Amendment 69 – ColoradoCare – is a Colorado ballot measure for comprehensive health care financing reform. It was defeated by a vote of 4 to 1. It joins California’s Prop 186 which was defeated 3 to 1 and Oregon’s Measure 23, also losing 4 to 1.

Although many surveys have shown that public support for a single payer national health program is about 60 percent, these state ballot measures failed miserably.

The nation is heavily polarized politically so you might expect that only half of the voters would approve such ballot measures, but these efforts were unable to gain even a majority within their own faction much less the support of the opposing faction.

The lesson is that, to be successful, a comprehensive state health reform ballot measure requires a massive education effort over a period of years if you expect to gain support of a sufficient portion of the electorate, and that has never been accomplished. People not only have to understand it, they have to want it. If you find that you have to keep explaining what your proposal is, you haven’t done enough, and your opponents can and will destroy your efforts with a few soundbites.

Bernie Sanders demonstrated that a concerted effort can bring single payer back into the national dialogue, but his efforts to support ColoradoCare fell on deaf ears. He even had to trade single payer for a public option to gain Hillary Clinton’s support, and where did that go? His efforts were phenomenal, but he can’t do it alone.

Education, coalitions, grassroots efforts are all essential, but without education, it is all for naught. Get to work.

Colorado rejects universal healthcare initiative, but supporters aren’t giving up

By Shelby Livingston
Modern Healthcare, Nov. 9, 2016

Colorado voters on Tuesday overwhelmingly voted down a measure to create a universal healthcare system that would finance healthcare services for most state residents.

The Bernie Sanders-backed measure, Amendment 69, garnered barely more than 20% of the vote. It required a simple majority vote to pass.

Despite the outcome, which was largely expected, supporters of ColoradoCare still considered the push for universal healthcare somewhat of a success.

“Win or lose, the issue of guaranteed access to healthcare for everyone without financial barriers was finally brought before the voters,” state Sen. Irene Aguilar, who has spearheaded ColoradoCare, told a crowd of supporters Tuesday.

“Obviously, we wish we had done better,” said Lyn Gullette, director of operations for the campaign behind the ballot initiative. At the same time, “There’s no way we’re going to stop working,” she said.

The initiative would have established a universal healthcare system to finance healthcare services for most Colorado residents under a federal waiver available to states under the Affordable Care Act. It would be funded by payroll taxes rather than insurance premiums, and beneficiaries would have no deductibles and no copays for preventive and primary care.

Supporters have been trying for a decade to bring the plan to the statewide ballot, but past efforts, most recently led by Aguilar, never got any traction. But this time around, the plan’s supporters collected more than 150,000 signatures to bring the plan before voters directly on the Nov. 8 ballot.

The measure faced an uphill battle. Opponents, mostly hospitals and insurers, raised more than $4 million, while supporters contributed just shy of $900,000 to finance their campaign. Advocacy groups representing hospitals and health insurers argued the plan would upend the coverage expansions under the Affordable Care Act, require unsustainable tax increases and undermine competition and patient choice. Employers said the payroll taxes would harm their businesses.

The Nov. 8 ballot language, though, may have been ColoradoCare’s greatest obstacle. Voters came face to face with an amendment stating it would raise taxes by $25 billion to fund the system, but nowhere did it say what state residents would save in the long run, making it a very hard sell, campaign spokesman Owen Perkins said.

Still, “we did achieve universal acceptance that there’s a problem with the status quo,” he said. Some initiative opponents have expressed a desire for a universal healthcare system, even if they didn’t like this specific amendment, he said.

The Colorado Hospital Association said it was pleased with voters’ decision to reject the measure.

“It was too risky, too uncertain and unaffordable for Colorado,” the association said in a statement.

Dr. Katie Lozano, president of the Colorado Medical Society, an organization of physicians who largely opposed ColoradoCare, said the amendment’s failure doesn’t validate the current health system, however.

“Our members expressed deep dissatisfaction with the current system, for their patients and their practices,” Lozano said in a statement. “It’s very important to us to ensure that Coloradans have high quality, affordable health care and good access to their doctors. Currently, there are too many barriers to good care and too many hoops to jump through to get insurance to cover care for patients, resulting in high levels of physician burnout.”

ColoradoCare would have eliminated the state-run health insurance exchange and transferred those funds to the new system. Federal programs like Medicare and Veterans Health Administration coverage would remain unchanged, and residents would still have the option of buying private health insurance, though they would still pay taxes to support ColoradoCare. Benefits under the plan would include primary, mental health, specialty and dental care and be governed by an elected 21-member board of trustees who would decide benefit details and set rates for providers contracting directly with the system.

Undeterred, the campaign for ColoradoCare will begin planning its next steps come December. Volunteers are already flooding Gullette’s email, asking for ways to help.

“There’s no question that we’re going to go forward,” she said. “People are still dying; people are suffering; people are going bankrupt.”

http://www.modernhealthcare.com…

Election places Medicare at greater risk

“Don’t Touch My Medicare!”

By Trudy Lieberman
Harper’s Magazine, November 2016

Given the monumental sums Medicare has been paying out, it’s hardly surprising that for years the annual report issued by the program’s trustees has argued that it needs more revenue. This year’s report, released in June, warns that although Medicare’s costs are low by historical standards, there is substantial uncertainty regarding the adequacy of future Medicare payment rates under current law.

Medicare is placing its bet for cost control on new ways to pay doctors, penalties for bad care, rewards for good care, and more coordinated care. Whether these practices will work and how much they will slow down the growth in costs is unknown, and most Medicare experts on both the left and the right believe that new revenue will be needed. Along with her colleagues at the American Institutes for Research, former Medicare trustee Marilyn Moon (who remains skeptical of privatization) believes that critics often overstate the program’s financial challenges.

The big question is who should bear the burden of necessary revenue increases — taxpayers or Medicare beneficiaries. So far the answer from the government, many economists, and conservative advocacy groups is, unequivocally, the beneficiaries. Moon and her colleagues note that the “potential depletion of the trust fund in the future is taken as ‘proof’ that benefits must be reduced.” But in a subsequent interview, she warns that as more of the cost burden is shifted to the beneficiaries, “the likely reaction will be that benefits become so small Medicare won’t remain viable. It would destroy the program.”

It’s ironic that when it comes to one of the government’s most popular public programs, there’s no talk of raising taxes — an option polls show much of the public is willing to support. The failure of policymakers to consider revenue increases reflects the success of the right’s thirty-year crusade to change the conversation. “Those of us at the Heritage Foundation and allied public-policy institutions like the American Enterprise Institute have effectively defined the terms of the debate on Medicare reform,” says Robert Moffit, a senior fellow at Heritage. The Democrats, he adds, “are debating our proposals. We’re not debating theirs.” Former Iowa senator Tom Harkin tells me that his fellow Democrats were poor strategists, always finding themselves in rearguard actions trying to block provisions they didn’t like. “The Democrats were talking a good game for the immediacy, not the long term. It’s like checkers,” he says. “They knew how to block the next move, but were not seeing the row lined up at the back of the board.”

http://harpers.org…

***

Comment:

By Don McCanne, M.D.

House Speaker Paul Ryan indicated today that, as a result of the election, they will now have a president who will sign their proposed legislation making major changes in our health care financing system. This important article by Trudy Lieberman explains the ongoing attack on Medicare and the threat to further privatize the program while shifting more of the burden of paying for health care onto the backs of the Medicare beneficiaries.

Trudy Lieberman warns us that conservative organizations “have effectively defined the terms of the debate on Medicare reform,” according to Heritage’s Robert Moffit. The Democrats have been complicit with the partial privatization of Medicare and likely will continue to be so as further erosion of Medicare accelerates under a conservative government (all three branches).

Harper’s allows access to one free article per month. Considering the danger Medicare faces, this should be the article for you. It is a fairly long article, so you may want to wait until you have a little more time, but do it this week for sure.

MedPAC to examine Medicare premium support

MedPAC Examines How Medicare Premium Support Might Work

By Kerry Young, CQ Roll Call
The Commonwealth Fund, November 7, 2016

Congress’s advisers on Medicare are studying what steps would be needed if lawmakers eventually were to shift the giant federal health entitlement program to a so-called premium support model designed to restrain spending. House Republicans have called for making such a change.

The Medicare Payment Advisory Commission (MedPAC) intends to offer lawmakers a review of these options in its June 2017 report, said Eric Rollins, an analyst with the panel. MedPAC will not make formal suggestions to Congress on this topic next year.

“We are not going to recommend for or against premium support,” said Paul Ginsburg, a MedPAC member and healthy policy researcher with the Brookings Institution and the University of Southern California.

Ginsburg said he expects Congress at some point to take a serious look at the concept of premium support, although it’s currently unlikely to do so at this time. MedPAC’s work this year will help prepare lawmakers for eventual discussions of this approach to managing Medicare, he said.

MedPAC intends to outline possible paths and pitfalls toward a more competitive system for administering health benefits for senior citizens and people with disabilities. Traditional fee-for-service Medicare might compete with insurer-run Advantage plans under this system, Rollins said in his briefing. People enrolled in Medicare could avoid higher premiums by seeking out plans with lower costs in this new model, MedPAC’s Rollins said.

House Republicans earlier this year called for a move toward premium support as part of their policy paper on health care. In the House GOP model, people on Medicare would be given a choice of insurer-run plans and traditional Medicare starting in 2024. In the paper, House Republicans note that the idea of premium support “is based on a long history of bipartisan reform plans, including the 1999 Breaux-Thomas Commission and the 2010 Domenici-Rivlin Report.”

The prospect of more out-of-pocket costs for beneficiaries likely will prove a hurdle for lawmakers who want to shift to premium support. Willis D. Gradison Jr., a MedPAC member who represented an Ohio district in the House from 1975 through 1993, raised this political consideration.

http://www.commonwealthfund.org…

***

October 2016 meeting presentation: Reforming quality measurement and implications for premium support

By Ledia Tabor and Carlos Zarabozo
MedPAC, October 7, 2016

Premium support in a local market area

* Each plan bids to provide benefits to average health beneficiary

* Medicare determines government contribution based on FFS and private plan bids

* If beneficiary selects plan with bid above government contribution they pay a premium; plan with lower bids give enrollees a cash rebate

http://www.medpac.gov…

***

Comment:

By Don McCanne, M.D.

MedPAC (Medicare Payment Advisory Commission) advises Congress on Medicare. As the October 7 MedPAC presentation demonstrates, they are currently preparing for Congress a review of premium support – a voucher model designed to restrain federal spending by shifting more costs to Medicare beneficiaries.

It is unlikely that today’s election will change the political climate to where immediate enactment of premium support would be likely, but since the 1999 Breaux-Thomas (Frist, Jindal) Commission there has been bipartisan support of this proposal, though predominantly from the Republicans. Both sides in Congress do want changes, and it is quite possible that premium support could be advanced through a conservative-neoliberal coalition effort involving tradeoffs, especially since it is likely that we will have a neoliberal president who could well sign such legislation.

So pay attention or we may end up with a privatized, defined contribution Medicare program which will compound problems of affordability and access for our Medicare beneficiaries, not to mention stifling our dreams of an improved Medicare for all.

California’s Prop. 61 Offers Opportunity to Take on Big Pharma

By RoseAnn DeMoro
Common Dreams, Nov. 2, 2016

While the world is watching the Presidential race Tuesday night, another election battle in California provides a window in the ability of voters to challenge corporate power – in this case one of the most abusive industries in the world, big pharma.

Proposition 61 in California pits the drug cartel and those shilling for it, against patients, nurses, and consumer advocates. At a time when the drug giants have buried proposals in Congress and state legislatures to block any restraints on its predatory pricing, Prop. 61 would actually begin the process of lowering prices.

The drug corporations are running scared. They’ve poured in over $120 million, the most ever spent on a California ballot measure (and likely the most ever in the U.S.) with a non-stop pounding of deceptive and misleading ads intended to bully voters the way they routinely intimidate lawmakers.

Some of the tactics are right out of the playbook the industry has used across the country. As veteran national healthcare writer Trudy Lieberman notes, “PhRMA has reaped big dividends from having patient advocacy organizations shill for it in the legislative and regulatory arenas.”

With Prop. 61, the drug companies rarely speak in their own name, hiding their opposition role behind others viewed to have more public credibility. The Intercept cites public filings that reveal “19 different civic organizations, from the Foreign Legion to a bilingual voter guide organization, taking drug industry funds and endorsing No on Prop 61.”

Among them are several LGBT Democratic clubs whose influence has helped neutralize some liberal to progressive potential supporters, and prominent veterans organizations, all of whom have received drug industry funding.

Additionally, big pharma has lined up most of the corporate news media with Trudy Lieberman caustically noting after reading many editorials and op eds, “I concluded they must have been written from drug industry talking points dropped off at the newspaper offices.”

Yet, in the face of the massive onslaught of ads, every time you turn on your TV, computer, or mobile device, Prop. 61 has held its own with voters, polls have shown, and has a real chance to win.

That’s what has the drug companies alarmed. Sen. Bernie Sanders, who has embraced Prop. 61 in videos, billboard ads, and campaign visit, says, “Californians on Nov. 8 have a chance to stand up to the pharmaceutical industry’s greed and spark a national movement to end this price-gouging.”

Nurses have crisscrossed the state in support of Prop. 61, noting that they see patients on a regular basis who put their health at grave risk by self-rationing medication because of the high out of pocket cost.

They tell stories like this one, from a Fresno RN Amy Arlund of a “young man in his late 40s living on a fixed income, working two jobs, who was diagnosed with high blood pressure. This one medication was going to cost him over $400 a month.

‘I’m young, still in my 40s,’ he thought, ‘I’ll just have to live with it a little longer.’

About three months after this diagnosis, because he could not afford to take his blood pressure medication, he had a massive stroke and is now permanently disabled.”

Or from Long Beach RN Margie Keenan, who described “patients provided a heart stent for serious coronary disease sent home with directions to take anti-platelet drugs for continuing therapy, are returning to the ER with serious chest pain. Or dying before they get there. Why? They can’t afford the high out-of-pocket cost for their medication.”

For those not keeping track, here’s what big pharma has become, an industry with enough wealth and power to make Pablo Escobar blush:

  • 164 – percent of price increase since 2008 for brand name drugs in the U.S.
  • $1.6 trillion – worldwide profits, 50 top drug companies since 1995.
  • $3.4 billion – federal lobbying, 1998 through 2016, more than any other industry, including the banking and fossil fuel industries.
  • 1,400 – pharma federal lobbyists, 2015.
  • $11 billion – compensation for pharma executives, 2011-2015, mostly based on pay for performance (high stock prices driven by inflated prices). Ten executives made an aggregate $327 million in 2015 alone.
  • $1.7 trillion –pharma mergers and acquisitions spending,  1992-2015, during which drug costs, fueled by monopolization, rose by over 300 percent.
  • 89 – percent of top 100 drug firms that spend more on marketing than on research and development (R&D), 27 percent spend 10 times as much. Much R&D is funded by taxpayers, performed at public universities.
  • 65 – percent of industry R&D for minor tweaks to existing drugs that do little to make them more effective, but allow the company to extend the monopoly patent protection for a high priced brand name drug over a generic alternative up to 20 more years.

(Note: Find more background on the pharmaceutical industry from CNA/NNU’s Institute for Health and Socio-Economic Policy here.)

Seen enough? Prop. 61 requires the state to pay no more for medications for people it covers than is paid for the same prescription drugs by the Department of Veterans Affairs, the one agency that has authority to use public power to negotiate bulk price discounts.

Prop. 61 won’t end drug price gouging, but it’s a big start. One industry publication called California “ground zero” in the battle against big pharma and warned drug company executives, that “adoption of VA pricing by the state of California would be a “pricing disaster” for the entire U.S. drug industry.

That would be welcome. Passing Prop. 61 would send an unmistakable message that you can confront the corporate grip over our politics, our economy and our health – and win.

RoseAnn DeMoro is executive director of National Nurses United.

http://www.commondreams.org…

High deductibles less effective than previous interpretations of RAND HIE

NBER Working Paper 22802
Intertemporal Substitution in Health Care Demand: Evidence from the RAND Health Insurance Experiment

By Haizhen Lin and Daniel W. Sacks
National Bureau of Economic Research, November 2016

Abstract

Nonlinear cost-sharing in health insurance encourages intertemporal substitution because patients can reduce their out-of-pocket costs by concentrating spending in years when they hit the deductible. We test for such intertemporal substitution using data from the RAND Health Insurance Experiment, where people were randomly assigned either to a free care plan or to a cost-sharing plan which had coinsurance up to a maximum dollar expenditure (MDE). Hitting the MDE — leading to an effective price of zero — has a bigger effect on monthly health care spending and utilization than does being in free care, because people who hit the MDE face high future and past prices. As a result, we estimate that sensitivity to short-lasting price changes is about twice as large as sensitivity to long-lasting changes. These findings help reconcile conflicting estimates of the price elasticity of demand for health care, and suggest that high deductible health plans may be less effective than hoped in controlling health care spending.

From the Introduction

Studying intertemporal substitution is important for at least two reasons. First, with the important exceptions of Einav et al. (2015) and Cabral (2016), most of the literature on health care demand and the effect of insurance on spending has neglected intertemporal substitution, and estimated in a wide range of price elasticities, from as small as -0.2 to as large as -1.5 (for example, Manning et al. (1987); Eichner (1998); Zweifel and Manning (2000); Cardon and Hendel (2001); Bajari et al. (2014); Dalton (2014) and Kowalski (2015, 2016))). Most papers assume that health care decisions are made statically on an annual basis, meaning that there is no scope for future prices to affect current demand. Estimated. However, if there is intertemporal substitution, then patients may respond very differently to a temporary price change than to a long-lasting one. Therefore, depending on the sources of price variation used for identification, one might draw dramatically different conclusions regarding price sensitivities. Accounting for intertemporal substitution makes it possible to separate elasticities with respect to permanent or temporary price changes, and may help reconcile the disparate elasticity estimates in the literature.

Second, intertemporal substitution affects the response to high deductible health plans, which are now common in the American health insurance landscape. Regulators, insurers, and policymakers tolerate the weak risk protection of high deductible health plans out of the hope that they will reduce health care spending. This view implicitly assumes that care foregone in one year because of the high deductible represents a permanent reduction in health care spending. But if patients are deferring needed care, then their spending may be higher in future years, either because deferrable problems become so severe that they must be addressed, regardless of the cost, or because once patients finally do hit the deductible, they stock up on care, retiming deferrable procedures to a year when their price is low. Thus a key question for the effectiveness of high deductible health plans is whether patients intertemporally substitute in their demand for health care. Evidence of intertemporal substitution would suggest that high-deductible health plans may not be as effective as hoped in controlling overall health care spending.

Reconciliation with original HIE findings

We have argued that intertemporal substitution is an important part of how patients respond to nonlinear cost-sharing, causing them to stock up on health care when it goes on “sale,” with especially large anticipatory responses. Neglecting these dynamics can lead to biased estimates of the long-run effect of cost-sharing on utilization. The original RAND investigators, however, argued that intertemporal substitution was not an important part of the response to cost-sharing, and found little evidence for anticipatory effects. Here we reconcile these different conclusions.

The key difference between our analysis and the original investigators is in the timing of when we look for intertemporal substitution and anticipatory responses. They focus on the period around hitting the MDE, before and after. We focus on the end of the coverage year. As Keeler and Rolph acknowledge, it is likely difficult to detect anticipatory effects or pent up demand by focusing on fine timing around hitting the MDE. Households may not know exactly when they hit the MDE (as has been pointed out by the original RAND investigators), and may not appreciate the link between their current and future spending (Einav et al., 2015; Dalton et al., 2015; Abaluck et al., 2015). On the other hand, by the end of the coverage year, most families who hit the MDE will have seen a bill which makes clear their financial position, and it is not hard to understand that in the future, prices will be higher. Indeed, providers may help make this clear. Thus the myopia or limited understanding of the insurance contracts may have made it difficult for the original investigators to identify intertemporal substitution; by looking at the end of the year, we avoid this difficulty.

From the Conclusion

Studying data from the RAND Health Insurance Experiment, we found striking patterns of health care spending over the insurance coverage year. In most months, spending is lower in cost-sharing plans than in the free care plan. But in the last 1-3 months of the coverage year, spending rises quickly in cost-sharing relative to free care, and by the end of the year spending in the two plans is roughly equal. On the other hand, spending in free care is roughly flat over the coverage year, but it is particularly high early in the first coverage year, and it spikes dramatically at the end of the experiment.

These patterns are inconsistent with the standard model of demand for health care, which assumes away intertemporal substitution. Instead they suggest that patients can retime their care, especially for medically deferrable procedures and dental care, to reduce their out-of-pocket expenses in the face of nonlinear cost-sharing rules. To quantify the importance of intertemporal substitution, we estimate how health care spending responds to lag and lead prices as well as current prices. The estimates suggest that short-run moral hazard — the response to a one time, unanticipated price change — is substantially larger than the long-run response.

These results have important implications for health care spending and insurance design. First, they help reconcile some of the disparate estimates of the price elasticity of health care demand, since they imply that health care spending is more responsive to temporary price changes — for example, hitting the deductible — than to permanent price changes, for example, from insurance plan changes. Second, they suggest that high deductible health plans may not be as effective as hoped in controlling health care spending. These plans can reduce health care spending as long as patients do not hit the deductible. But in years when patients do hit it — as they eventually will — the large short-run response means that spending will make up for lost time, as patients stock up on care.

http://www.nber.org…

***

Comment:

By Don McCanne, M.D.

At the risk of over-simplification, we can interpret this complex study to show us that previous conclusions from the RAND Health Insurance Experiment (RAND HIE) ignored the responsiveness of year-end health care spending once hitting the deductible, and that particular increase in spending suggests that “high deductible health plans may not be as effective as hoped in controlling health care spending.”

The primary purpose of high deductibles in insurance plans is to reduce health care spending by insurers, employers and government plans. The tradeoff is that they create financial hardships and impair health care access for patients. But isn’t health care reform supposed to be about the patients?

How much are deductibles really saving? For the 20 percent of people using 80 percent of health care, the savings are negligible since the deductible is met early on for those individuals and thus has no further impact. For the four-fifths of us who use only one-fifth of the nation’s health care, many of us have deductible coverage through Medicaid, Medigap or MA plans, or health savings accounts, and thus are not affected.

So who is negatively impacted by high deductibles? It is individuals who do not qualify for Medicaid nor for ACA subsidies and who often cannot fund a health savings account. This is our workforce and their families. As a percent of our national health expenditures, the amount saved is very small, and may be even smaller than believed based on this NBER study. This seems to be too heavy of a price to pay for such a relatively small savings.

So high deductibles don’t work very well and they harm patients. In contrast, single payer tools do control spending while helping patients. Do we really have to continue contemplating making the change that would finally fix our system? Why not action now?

Affordable Care Act hikes could spark Medicare for All

By Bill Knight
Morton (Ill.) Times-News, Oct. 31, 2016

Illinoisans who don’t have health insurance through their jobs or from individual policies they bought face premium hikes as sign-up starts this week for the Affordable Care Act, and those who fault President Obama for everything from Bears quarterback Jay Cutler to another danged week of Daylight Saving Time aren’t hesitating to blame Obama.

There’s plenty of blame to go around, but focusing exclusively on Obama is like denouncing an architect when the rent goes up. Building designers, engineers, contractors or carpenters aren’t landlords, and Obama didn’t decide to raise premiums.

Here, now, it’s the insurers, and their greedy move could be the Step Too Far that rekindles consideration of Medicare for All.

In Illinois, premiums would go up 44 percent for the lowest-priced “bronze” plans, and about 300,000 people not in employers’ plans, Medicare or Medicaid could be affected. Out of 10.5 million enrolled nationwide, about 1.6 million face higher prices.

Besides insurers’ premiums increasing, policyholders’ choices in insurance exchanges — central to the ACA — are decreasing. In states using HealthCare.gov, the number of plans is dropping from 47 to 30 because corporations such as Aetna, UnitedHealth Group and Humana are pulling out of some states, concerned that they otherwise won’t continue making millions in profits – essentially blaming policyholders who actually need the coverage. (If health insurers covered only young and healthy people and paid no medical expenses, they’d REALLY make profits.)

When Bill Clinton on Oct. 3 called it a “crazy system … with their premiums doubled and their coverage cut in half,” he was talking about private companies being in charge of public good.

However, insurers’ actions in the ACA – signed into law in 2010 but not fully implemented until 2014 — could spark demands for Medicare for All.

In the meantime, ACA officials recommend shopping around for less-expensive plans and using available subsidies, which increase along with premium prices. But Health and Human Services Sec. Sylvia Mathews Burwell also adds that lawmakers share responsibility, too, not only for insisting on keeping the insurance industry in its powerful position, but Congress’ “efforts to undermine the ACA,” like trying to kill the ACA more than 60 times, blocking funds to help protect insurers with high-cost customers, and refusing to expand Medicaid. Some 3 million people can’t get Medicaid help because the Supreme Court OK’d states’ right to decline expanding Medicaid.

“It’s not because of any policy in the Affordable Care Act that the rates are going up,” Obama said. “If state leaders purposefully try to make something not work, then it’s not going to run as smoothly.”

Further, constant criticism by right-wing radio, Fox News and their ilk contribute to the ACA’s low approval rating while its actual provisions (preventive care, coverage for those with pre-existing conditions, protections for young people, and cancer screenings) are popular.

U.S. Sen. Bernie Sanders said, “Health care cannot continue to be dependent upon the whims and market projections of large private insurance companies whose only goal is to make as much profit as possible. That is also why we need to pass a Medicare-for-All, single-payer system.”

The ACA is having success, too. Experts expect enrollment to rise to a monthly average of 11.4 million next year, health-care jobs are increasing, and hospitals’ finances improving, according to the new book “150 Years of Obamacare” by Daniel Dawes, who notes that a recent Gallup survey showed that the percentage of uninsured nonelderly adults is 11.5, a historical low, down from about 20 percent in 2012.

Plus, putting the country’s health-care spending into perspective, projections in 2009 called for health-care spending to increase 19.3 percent of Gross Domestic Product by now, but the ACA has helped hold that to 18.1 percent, according to economist Dean Baker.

Meanwhile, Medicare for All could build on strengths and fix weaknesses by encouraging cost control because service, not profit, would be the priority. As Margaret Flowers of the Physicians for a National Health Program explains, “Insurance companies cherry-pick the healthy. The only thing that will turn this system around is to expand traditional Medicare. Everyone is in it. All the health-care providers are in it. Everyone pays through a progressive tax. Then we can get the cost savings that we need to provide high-quality universal care.”

http://www.mortontimesnews.com…

Fix our system? Listen to Oxfam and Doctors Without Borders

The U.S. Is Standing in the Way of Cheaper Drugs for the Poor

By Jason Cone and Raymond C. Offenheiser
The New York Times, October 27, 2016

In the United States, companies have raised prices on many drugs over the past five years, mostly with little public notice or scandal. Pfizer alone raised the prices of more than 100 drugs in one year. Drug prices have seen double-digit inflation over the past three years, at a time of relatively low inflation in the rest of the economy. Recent research suggests that cancer patients may be delaying use of lifesaving drugs, while there are reports that prisoners are rationed access to hepatitis C treatments — all because of high prices.

But this problem is also international. In poorer countries across the world where our organizations work, millions of people are priced out of medicines that could save lives and relieve suffering. For example, a recent World Health Organization study found that in some 30 countries, hepatitis C medicines were unaffordable for much of the population.

Pharmaceutical companies simply charge whatever they want — or can. They have big budgets to counter image problems from bad press and congressional hearings. And while they claim that high prices are necessary to develop new drugs, it’s just not true. Public funding and subsidies pay for much of today’s pharmaceutical innovation.

Many world leaders recognize that high drug prices are a public-health crisis. Earlier this year, Ban Ki-moon, the secretary general of the United Nations, commissioned a panel of industry, government, academic and civil society experts, including Oxfam International’s executive director, to recommend ways to bring drug prices down to affordable levels and to improve research and development of new medicines in order to fulfill the human right to health.

The panel’s report, released last month, found that today’s system is failing. Pharmaceutical monopolies reap huge profits from high prices, while medicines are unaffordable for too many people. The report called for more transparency and competition in the drug industry and for preserving and implementing existing policies that help reduce prices.

Shamefully, the American government sought to obstruct and oppose the panel, even denying the premise that high drug prices undermine public health.

The Obama administration’s response to the report’s release called the panel’s work “deeply flawed” and accused it of recommending “divisive policies,” which it warned ominously “could have significant unintended negative consequences.” In other words, if we want new medicines and innovations, we must continue to support a system in which the pharmaceutical industry has unlimited power to set prices. Considering alternative pathways is apparently off limits.

These scare tactics not only contradict the United States’ stated global and domestic health priorities, they are also an offense to people unable to afford critical treatment. Worse yet, the American government actively exports this approach to other countries through trade agreements like the Trans-Pacific Partnership, which, if allowed to take effect, will lock in and extend global monopoly protections and high medicine prices for years to come.

Yet to really transform how drugs are developed, governments must lead the charge. There are hopeful signs this might happen. In September, world leaders agreed to address antibiotic resistance in part, by committing to develop new drugs through such new research and development models.

The United Nations panel recommendations, which the Obama administration has tried to attack and discredit, are precisely designed to open new paths to medical innovation that benefit us all. Access to existing and new medicines and treatments should not depend on how much money you have, where you were born or whom you know.

The United States government, especially the next president, must stop defending industry profits and work to reform how we pay for medical research to ensure that all patients’ needs are addressed. High prices of medicines are not inevitable; they are a choice the American government has made. Many lives and livelihoods hang in the balance until that choice changes.

Jason Cone is the executive director of Doctors Without Borders USA. Raymond C. Offenheiser is the president of Oxfam America.

http://www.nytimes.com…

***

Comment:

By Don McCanne, M.D.

Those of us who have tried so hard for so long to fix our dysfunctional health care system will understand this article. Reform efforts being celebrated today have enhanced the business successes of the medical-industrial complex and especially the insurance and pharmaceutical industries, while patients face more barriers to care through restricted networks, greater cost sharing and exorbitant pricing.

What is missing here? Jason Cone of Doctors Without Borders USA and Raymond Offenheiser of Oxfam America make it quite clear that it is our government that is failing the people while taking care of the industrial special interests.

Perhaps worse, we have a polarized nation with one side opposed to all things government in health care, and the other side celebrating the government’s gifts to the industry even though the welfare of patients is sacrificed in order to accomplish those ends.

In a democracy we are supposed to be able to fix these problems through our elections. But on my ballot for next Tuesday I don’t see any options that could realistically assure us support for the altruistic goals of Oxfam and Doctors Without Borders. It’s not like in two years of campaigning there wasn’t adequate opportunity to advance ideas that would truly make us stronger together as we make America great again. All we got instead was campaign slogans and further polarization on a scale with negative polarity at either end.

Sorry.