Letter: Clovis’ teachers benefit from union gains

By Sandra McCanne, San Juan Capistrano
The Orange County Register, August 21, 2016

Re: “On teacher freedom, Clovis sets an example for California” [Opinion, Aug. 18]:

Kudos to the school teachers and administrators in Clovis. However, I disagree that the unions have played no role in their success.

People need to be compensated financially for their work and level of expertise. The teachers union has been key in obtaining adequate pay for its members. If Clovis paid salaries less than surrounding unionized communities, they would not be able to recruit qualified teachers.

Thus, the Clovis teachers reap the benefits without contributing their fair share financially to the process.

http://www.ocregister.com/articles/large-726455-california-scale.html

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Union decline lowers wages of nonunion workers: The overlooked reason why wages are stuck and inequality is growing

By Jake Rosenfeld, Patrick Denice, and Jennifer Laird
Economic Policy Institute, August 30, 2016

Pay for private-sector workers has barely budged over the past three and a half decades. In fact, for men in the private sector who lack a college degree and do not belong to a labor union, real wages today are substantially lower than they were in the late 1970s.

Unions, especially in industries and regions where they are strong, help boost the wages of all workers by establishing pay and benefit standards that many nonunion firms adopt. But this union boost to nonunion pay has weakened as the share of private-sector workers in a union has fallen from 1 in 3 in the 1950s to about 1 in 20 today.

The impact of the erosion of unions on the wages of both union and nonunion workers is likely the largest single factor underlying wage stagnation and wage inequality.

http://www.epi.org/publication/union-decline-lowers-wages-of-nonunion-workers-the-overlooked-reason-why-wages-are-stuck-and-inequality-is-growing/

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Donald Trump is the Anti–Labor Day Candidate: Running Against Fair Wages, Worker Rights, and Unions

By John Nichols
The Nation, September 4, 2016

Donald Trump, the billionaire candidate who has argued that “having a low minimum wage is not a bad thing for this country” and complained in a 2015 GOP debate that wages are “too high,” is running for president this fall on the most virulently anti-worker and anti-union platform in the history of his Republican Party.

Trump’s decision to make fiercely anti-union Indiana Governor Mike Pence his running mate should be read as another signal that the Republican presidential nominee is prepared to steer federal policy making toward the disastrous approaches of dogmatic governors such as Pence and Wisconsin’s Walker.

Trump and the anti-labor partisans who nominated him for the presidency have rejected the legacy of a Grand Old Party that once cheered when Abraham Lincoln declared: “Labor is prior to and independent of capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration.”

Dwight Eisenhower warned, as a Republican president, about politicians “who hold some foolish dream of spinning the clock back to days when unorganized labor was a huddled, almost helpless mass.”

“Only a handful of unreconstructed reactionaries harbor the ugly thought of breaking unions,” Eisenhower argued in the prosperous 1950s.

https://www.thenation.com/article/donald-trump-is-the-anti-labor-day-candidate-running-against-fair-wages-worker-rights-and-unions/

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Comment:

By Don McCanne, M.D.

Labor Day seems to be an opportune time to step back and take a look at how today’s labor force is faring.

Wages are stagnant. The income and wealth inequality gap has increased in recent decades. Financial hardship is rampant. This has coincided with the suppression of unions and their bargaining power.

In the past, workers who were not members of unions have benefited from the higher standards for all workers that union negotiation had achieved. The study by the Economic Policy Institute demonstrates that the decline in unions coincides with a negative impact on the wages of all workers, union or not.

Unions have also fought for health benefits for their members, and that led to employer sponsored plans covering more Americans, union or not, than any other public or private health program. But that still left many out. With the decline in union power, the nation has turned to the Affordable Care Act to try to fill the void, but that has fallen short as well.

Unfortunately, the problem is political, but it need not be so. The Republican party has traditionally supported America’s workers, and they can do so again, although they seem to be missing the opportunity in this election year.

Just as union support for living wages improves incomes for all workers, their support for health care would do the same. But they do need to redirect their support away from the current fragmented system that leaves so many uninsured and underinsured, and move towards a system that would work for everyone: a single payer national health program – an improved Medicare for all.

(A personal note:  I’m especially proud of Sandy, my bride of 56 years who, without my prompting, wrote the above letter to the libertarian Orange County Register, letting them know that celebrating free riders stains the concept of freedom.)

Physicians for a National Health Program is a nonpartisan educational organization. It neither supports nor opposes any political party or candidate for public office.

Editors on the Campaign Trail: Why Bernie Sanders Is Wrong on Health Care (and Hillary Clinton Is Right)

By Roy Grant, MA, Associate Editor, AJPH
American Journal of Public Health, August 2016

The two candidates to the 2016 Democratic Presidential primary, former Secretary of State Hillary Clinton and Senator Bernie Sanders (I-VT), both attempt to implement the principle that health care is a basic right, but Sen. Sanders’ advocacy for single-payer health care has dominated the discussion.

On the Republican side, health care has not received much attention, besides attempts to repeal the Affordable Care Act of 2010 (ACA). Donald Trump, the presumptive 2016 Republican nominee, proposes increasing competition, block granting Medicaid, and expanding health savings accounts, all Republican boilerplate proposals. In the absence of greater specificity, there is no health care plan to discuss.

Hillary Clinton Is Right on Health Care

Sec. Clinton maintains that attempting to implement single-payer would disrupt our current health care system, repeal the ACA, and plunge the nation back into contentious debate. The ACA expands insurance coverage as it currently exists in the United States, with 66% privately insured (mostly employer-provided) and 34% government insured. A single-payer system would cover the 11% uninsured but replace coverage and potentially disrupt health care for the nearly 90% of insured Americans and effectively repeal much of the ACA.

Sec. Clinton correctly recognizes the success of the ACA. Between October 2013 and early 2016, 20 million previously uninsured adults gained coverage, reducing the uninsured rate from 20.3% to 11.5%. African-Americans, Hispanics, and women made the greatest gains. The first group to benefit from expanded coverage — young adults — now has fewer emergency room visits, which contributes to lower overall health care costs.

Conclusions

The Sanders single-payer program would fulfill the progressive goal of universal health care as a right, if passed by Congress and successfully implemented. The evidence shows insufficient political support to pass single-payer and implementation barriers including tax policy and devolution of health policy to the states. Evidence supports Sec. Clinton’s position that building on the ACA would move us toward universal coverage but maintain progress made by the law. This approach is consistent with the politics of divided government and more likely to succeed.

The difference between the two positions may be viewed as ideology versus realism. Ideology may be more inspirational but is less likely to produce change.

http://ajph.aphapublications.org/doi/full/10.2105/AJPH.2016.303285

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Brown Responds: Why Hillary Clinton Is Wrong and Bernie Sanders Is Right

By Theodore M. Brown, PhD, Associate Editor, AJPH
American Journal of Public Health, August 2016

Refuting “Clinton Is Right: ACA Represents True Progress”

I agree that the ACA has had certain positive results: 20 million previously uninsured adults have achieved coverage; African-Americans, Hispanics, and women have made considerable gains; and young adults now have expanded coverage on their parents’ policies. Several other positive improvements could be added to this list. However, the ACA fails to establish a right to uniformly high-quality health care, crystallizes unequal levels of access for those who get care, leaves out 30 million people altogether, and adds to the excessively complex and costly administrative features of our health system. The ACA also strengthens the role of the commercial insurance industry by sanctioning its inefficient multiplicity of profit-maximizing companies and their high overhead costs, by allowing exorbitant premium charges, deductibles, and out-of-pocket expenditures (especially in policies bought through the health exchanges), and by condoning tough restrictions in the choice of providers (also especially in policies bought through the exchanges). The ACA, in fact, guarantees the commercial insurance industry substantial new business facilitated by government subsidies and exercises very limited control over the rapidly escalating cost of insurance. Moreover, the ACA fails to limit the huge, often unconscionable prices and profits of the pharmaceutical industry.

Refuting “Single-Payer Would Disrupt Health Care Delivery”

Grant doesn’t say so directly, but he seems to endorse Hillary Clinton’s scare tactic scenario. However, I see no plausibility to the projected cascade of negative events. In fact, it was the ACA that had a disastrous rollout, whereas the implementation of “radical” single-payer Medicare in the 60s was remarkably smooth and efficient.5 Moreover, the supposed fear and opposition of the “protected public” (the 90% of Americans who are currently insured) may be minimal or nonexistent. After all, that public has been frustrated and angered by regular increases in premium costs, deepening deductibles, copayments and out-of-pocket costs generally, runaway and often obscene drug prices, the general threat of medical bankruptcy, and a widespread sense of powerlessness. The American public, in fact, does not feel “protected,” and according to a recent tracking poll has clearly indicated strong willingness to opt for single-payer over yet another attempt at the status quo or its incremental extension.6 We can also add to the widespread sense of dissatisfaction with our current system the realization by employees that they would be freed by a universal single-payer system from job lock and by employers that they would have less obligation to underwrite the health care costs of their workers. Who exactly would feel frightening disruption, other than the profit-maximizers of our current system?

Refuting “Building on ACA Is the Only Pragmatic Way”

Here I strongly disagree because attempting to build incrementally on the ACA will simply consolidate and concretize its fundamental flaws and even deepen some. The essential mistake is to believe that incrementalism is the only true path of American political progress. But this belief is belied by the facts of our political history. That’s not how we got Social Security or civil rights legislation.

Health care is a right, and single-payer is the fairest and most cost-effective way to achieve it in practice.

http://ajph.aphapublications.org/doi/full/10.2105/AJPH.2016.303277

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Comment:

By Don McCanne, M.D.

Although more people than ever now have health insurance, there remain intolerable deficiencies in our health care financing system that clearly demand remedy. Two associate editors of the American Journal of Public Health debate the two approaches to reforming health care: Hillary Clinton’s expansion of ACA, and Bernie Sanders” single payer reform.

The thrust of today’s message is that these are the two legitimate approaches. Some in the media still seem to think that the only two approaches are Clinton’s expansion of ACA and Trump’s repeal and replacement of Obamacare. But as stated above, in the absence of greater specificity, the Republicans have “no health care plan to discuss.” Most of their boilerplate proposals would move us backwards – diminishing access and affordability.

So the real choice is, do we live with the dysfunctional system we have, merely tweaking it with measures such as adding yet one more (public) option to our fragmented system, or do we actually fix it by making health care affordable and accessible for all through single payer?

In arguing for ACA expansion Roy Grant indicates that single payer is inspirational but not pragmatic, whereas Theodore Brown points out that pragmatic incrementalism is not how we got Social Security or civil rights legislation. How can we let the nebulous notion of pragmatic inertia obstruct the inspirational, dynamic reform that we need?

AB-72, Health care coverage: out-of-network coverage

California State Assembly
California Legislative Information, Sept. 1, 2016

Summary (as amended):

Establishes a payment rate, which is the greater of the average of a health care service plan (health plan) or health insurer’s contracted rate, as specified, or 125% of the amount Medicare reimburses for the same or similar services; and an independent dispute resolution process (IDRP) for claims and claim disputes related to covered services provided at a contracted health facility by a noncontracting individual health care professional for health plan contracts and health policies issued, amended, or renewed on or after July 1, 2017. Limits enrollee and insured cost sharing for these covered services to no more than the cost sharing required had the services been provided by a contracting health professional.

Votes:

8/29/16 – Senate: Passed 35 to 1

8/31/16 – Assembly: Passed 79 to 0

To Gov. Jerry Brown

https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201520160AB72

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Comment:

By Don McCanne, M.D.

Under private insurance, a person who is admitted to an in-network hospital may unavoidably or inadvertently receive care from a professional, such as an anesthetist, who is not in the insurer’s network, and thus the patient may be responsible for the entire bill rather than the insurer’s normal contracted amount. This legislation corrects that injustice by making the patient responsible only for cost sharing that is no greater than it would have been had the provider been in the network.

So what are the other implications of this legislation?

The out-of-network provider is no longer able to demand payment for the full fee but has to accept either the same payment that in-network providers receive or 125% of the Medicare rate, whichever is higher. If the out-of-network provider demands more, a dispute resolution process with the insurer is established, but in no circumstances does the patient pay more than the contracted in-network cost sharing.

Think about that. One of the ways that insurers are attempting to control spending is through the use of provider networks, the narrower, the better. If the insurer has a contract with the hospital, then why bother with contracting with the specialists who might be called in since they will have to accept the contracted rate even though no contract has been established with these providers, just as Medicare can establish rates for those who have not signed Medicare contracts. Also, since the insurers do not need as many physicians in their ultra-narrow networks, they can hold out for even lower contracted rates with those who do agree to sign contracts – rates which will also apply to the physicians who remain out-of-network.

Think some more about that. This places the private insurer in the position of being able to dictate price controls within the private health care delivery system. It has long been acknowledged that the government can establish rates through programs such as Medicare and Medicaid. Even though Medicare rates do tend to be fairly low, most physicians continue to see Medicare patients, even if they prefer the higher rates often paid by private insurers. However, the private Medicare Advantage plans are now paying less than traditional Medicare rates. It does not take much to imagine that the private insurers will now try to push the rates for their commercial plans below the traditional Medicare rates as well.

This legislation is important because it recognizes that we must take care of patients first. Also this legislation recognizes that the providers must be paid, but not at extravagant fees that they might set themselves. But what about the private insurers? Why do we need them at all?

Under a single payer Medicare-for-all system, the fees would be set, but at a level that would ensure adequacy of the health care delivery system. The waste of the private insurers and the burden they place on the delivery system would be recovered so that it could be spent on patient care instead. The patients would certainly benefit, and the hospitals, physicians and other professionals would do just fine as well under a public financing system.

Public Funds Account for Over 70 Percent of Health Care Spending in California

By Andrea Sorensen, Narissa J. Nonzee, and Gerald F. Kominski
UCLA Center for Health Policy Research, Health Policy Brief, August 2016

Summary

In California, personal health care expenditures are estimated to total more than $367 billion in 2016. Approximately 71 percent of these expenditures will be paid for with public funds (i.e., taxpayer dollars). This estimated contribution of public funds to health care expenditures is much higher than estimates that include only major health insurance programs such as Medicare and Medicaid. Several additional public funding sources also contribute to health care expenditures in the state, including government spending for public employee health benefits, tax subsidies for employer-sponsored insurance and the Affordable Care Act (ACA) insurance exchange, and county health care expenditures. As health care reform continues to take effect, it will be important to monitor the public versus private contributions to state health care expenditures to ensure that funds are being distributed both efficiently and equitably.

Health Care Expenditures in California

In California, health care expenditures in 2016 are estimated to total more than $367 billion; our estimates suggest that 71 percent of these expenditures will be paid for with public funds. Medi-Cal/Healthy Families will comprise the largest proportion of total spending (27 percent), followed by Medicare (20 percent). Tax subsidies for ESI (12 percent); government spending for public employee insurance (4 percent); county health expenditures (3 percent); other government programs—Veterans Affairs (VA) health care, Indian Health Services, and Maternal and Child Health (3 percent altogether); and ACA marketplace exchange subsidies (2 percent) will account for the remainder of total expenditures. Private expenditures for covered benefits will comprise approximately 29 percent of total health care spending in California in 2016. These expenditures include employer share of premiums (16 percent), employee share of premiums (6 percent), out-of-pocket expenditures for covered benefits (4 percent), and premium contributions for individually purchased insurance (3 percent).

Conclusion and Recommendations

Public funds in California contribute to approximately 71 percent of total state health care expenditures. As an increasing number of individuals gain health insurance coverage under the ACA, as health care expenditure growth rates continue to increase, and as policy debates continue to mount around introducing a public insurance option, it is important that public funding for health care expenditures be monitored. Comparable to national-level analyses, these findings run contrary to the assumption that U.S. health care expenditures are funded primarily by private payers. If public funds continue to comprise the majority of total health care expenditures, it will be increasingly important for policymakers to consider whether these public funds are being distributed efficiently and effectively, and whether alternatives such as a state single-payer system would be a more effective use of public and private health spending.

http://healthpolicy.ucla.edu/publications/Documents/PDF/2016/PublicSharePB_FINAL_8-31-16.pdf

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Public money accounts for more than two-thirds of health care spending in California

By Gwendolyn Driscoll
UCLA Center for Health Policy Research Newsroom, August 31, 2016

Contrary to the notion that the country’s health care is primarily a privately funded system, 71 percent of health care expenditures in California are paid for with public funds, according to a new analysis by the UCLA Center for Health Policy Research.

In California, public funds will pay for 71 percent ($260.9 billion) of a projected $367.5 billion spent on health care in 2016, according to the study.

“The public sector is the primary player in health care spending,” said Gerald Kominski, director of the UCLA Center for Health Policy Research who led the study. “But monies are disbursed in a fragmented way through numerous different entities, each of which has their own system and way of doing things. The question for policy makers is, ‘does this fragmented approach make sense?’”

“For a majority of Californians, a public-run system is already the reality,” said Andrea Sorensen, a graduate student at the UCLA Fielding School of Public Health, who co-authored the study. “A single-payer system could unite all these various programs and expand them to the entire population, resulting in a more streamlined and cost-effective approach to health care spending.”

http://healthpolicy.ucla.edu/newsroom/press-releases/pages/details.aspx?NewsID=252

David Himmelstein and Steffie Woolhandler on the national taxpayer share of health costs:
http://ajph.aphapublications.org/doi/abs/10.2105/AJPH.2015.302997

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Comment:

By Don McCanne, M.D.

Over two-thirds of health care in California – 71 percent –  is paid for by the government, using our taxes. That is even greater than the national taxpayer share of health care – 64 percent (increasing to 67 percent in 2024) – as demonstrated by Himmelstein and Woolhandler.

As Himmelstein and Woolhandler have stated previously, U.S. taxpayers are already paying for a national health program, but not getting it. And that is even more true for Californians.

California has previously made efforts to adopt a single payer program, but they have failed – in the election booth, in the state legislature, and on the governor’s desk. As we continue to shift more of health care costs to the government, we have brought along our terribly wasteful, fragmented health care financing system. The California taxpayers are getting a bad deal, and a very expensive one at that ($261 billion for 2016 in public spending alone).

Without enabling federal legislation, states are limited in how close they can come to a much more efficient single payer system, but that does not mean that we should not proceed with whatever is possible now.

California, and every other state for that matter, should do two things simultaneously: 1) Advocate vigorously for a national single payer program – an improved Medicare for all, and 2) Move forward on a state level with improving the health care financing system so that eventual transition to a national program will be that much simpler, not to mention providing some limited interim relief.