PNHP

Maine Doctors Support Single Payer

Maine Doctors Support Single Payer

By Julie Keller Pease, M.D.
The Times Record (Brunswick, Maine), Letters, Oct. 7, 2015

I was interested to read the article in Friday’s Times Record about the “Broader health care debate for 2016.” Giving prominence to “single payer” makes sense because only a single-payer plan can cover everyone for all medically necessary care, eliminate financial barriers to care, and allow free choice of doctor and hospital. Single payer healthcare would also control costs. Noted healthcare economist Dr. William Hsiao, when he visited Maine in 2010, estimated that if Maine moved to a single-payer system of health care, the state would save $1 billion during the first year alone.

Currently, the criticism of single payer (mentioned in the article) is that it would require a tax increase. In his fiscal study of H.R. 676, “The Expanded and Improved Medicare for All Act,” economist Dr. Gerald Friedman estimated that 95 percent of all households would actually SAVE money. This is because any increase in taxes would be more than offset by a massive decrease in insurance premiums and out-of-pocket expenses. Further, a streamlined single-payer system would reap about $400 billion annually in savings by slashing wasteful administrative costs, the government would be able to use its negotiating clout to bargain for lower drug and medical supply prices and it would be allowed to take other proven measures to save money.

Maine doctors support single payer. In January 2014, 450 Maine physicians responded to a survey question from the Maine Medical Association: “When considering the topic of health care reform, would you prefer to make improvements to the current public/private system or a single-payer system such as a ‘Medicare for all’ approach’? Nearly 65 percent of Maine doctors preferred the single-payer option, a jump from about 52 percent in a 2008 MMA survey that asked the identical question.

If you’re interested in learning more about health care for all, I urge you to visit the websites of Physicians for a National Health Program (www.pnhp.org) and Maine AllCare (www.maineallcare.org). Please join us in our advocacy for health care for everyone in Maine.

Dr. Julie Keller Pease resides in Brunswick.

http://www.timesrecord.com/news/2015-10-07/Opinion/Maine_Doctors_Support_Singlepayer.html

What lessons can we learn from Europe’s health insurance exchanges?

Risk Selection Threatens Quality Of Care For Certain Patients: Lessons From Europe’s Health Insurance Exchanges

By Wynand P. M. M. van de Ven, Richard C. van Kleef and Rene C. J. A. van Vliet
Health Affairs, October 2015

Abstract

Experience in European health insurance exchanges indicates that even with the best risk-adjustment formulas, insurers have substantial incentives to engage in risk selection. The potentially most worrisome form of risk selection is skimping on the quality of care for underpriced high-cost patients—that is, patients for whom insurers are compensated at a rate lower than the predicted health care expenses of these patients. In this article we draw lessons for the United States from twenty years of experience with health insurance exchanges in Europe, where risk selection is a serious problem. Mistakes by European legislators and inadequate evaluation criteria for risk selection incentives are discussed, as well as strategies to reduce risk selection and the complex trade-off among selection (through quality skimping), efficiency, and affordability. Recommended improvements to the risk-adjustment process in the United States include considering the adoption of risk adjusters used in Europe, investing in the collection of data, using a permanent form of risk sharing, and replacing the current premium “band” restrictions with more flexible restrictions. Policy makers need to understand the complexities of regulating competitive health insurance markets and to prevent risk selection that threatens the provision of good-quality care for underpriced high-cost patients.

Lessons from Europe:

Risk Selection Is A Serious Problem

Examples of selection activities include offering health plans attuned to the preferences of the under- and overpriced insured, opening clinics in regions with healthy populations, closing offices in areas with underpriced high-cost populations, selective marketing to preferred groups, the use of group contracts, and selection of favorable applicants by insurance agents.

The situation is more critical in the United States than in Europe in the short run, because in the United States there are many competing managed care organizations that deliver care themselves and therefore, compared to European insurers, have much more effective and subtle tools to use to distort the level of quality of care. In addition, for-profit insurers in the United States have extensive experience with risk selection.

Risk Adjustment Should Be Improved

Because risk adjusters ideally should fulfill criteria such as appropriateness of incentives, fairness, and feasibility, adding new risk adjusters may involve trade-offs. For example, using a patient’s health care expenses in the previous year as a risk adjuster effectively reduces selection by insurers, but it also reduces the insurers’ incentives for efficiency.

The United States might consider adopting the following risk adjusters that are currently used in Europe: disability, pharmacy-based cost groups, previous use of durable medical equipment, and high costs from multiple prior years.

Invest In Collecting Data

Another lesson for US policy makers is that it is worthwhile to invest in collecting appropriate data. Several of the risk adjusters currently used in Europe required many years of investment in building up appropriate data systems.

Risk Sharing Is An Effective Strategy

Given imperfect risk adjustment, which seems inevitable to a certain extent, an effective strategy for reducing selection incentives is risk sharing. There are several forms of risk sharing. One form is mandatory risk sharing among insurers, which is sometimes referred to as mandatory reinsurance with a community-rated reinsurance premium. Another form is risk sharing between the regulator and the insurers — for example, when a regulator provides cost-based compensations to the insurers for high-cost patients. Because risk sharing also reduces an insurer’s incentive for efficiency, it confronts the regulator with a trade-off between selection and efficiency.

Adopt A Generic Premium Rate Band

Another effective strategy for US policy makers to use in reducing risk selection is to allow insurers to charge their enrollees, within a band or range of acceptable charges, risk-adjusted health insurance premium rates. As a result, the information surplus about enrollees that insurers have over the regulator might be focused on premium rate variation rather than on risk selection.

Understand The Complexities

An important lesson from European experience with health exchanges is that there are no easy solutions and that regulating competitive health insurance markets involves complex trade-offs among selection (through quality skimping), efficiency, and affordability. Another lesson from Europe is that legislators and policy makers can easily make serious mistakes and be misled by incorrect arguments.

http://content.healthaffairs.org/content/34/10/1713.abstract

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Risk Selection Threatens Quality of Care for Certain Patients: Lessons from Europe’s Health Insurance Exchanges

The Commonwealth Fund, October 6, 2015

The Issue

Beginning in the early 1990s, several European countries, along with Israel, established health insurance exchanges similar to those launched in the U.S. as part of the ACA. For a Commonwealth Fund–supported study in Health Affairs, researchers gleaned lessons from those countries on how to reduce incentives to engage in risk selection. Insurers can engage in risk selection by steering away high-risk patients in a variety of ways, including purposefully contracting with doctors or hospitals that offer mediocre or substandard care or excluding providers with the best reputations for treating certain diseases.

The Big Picture

Risk selection may be a more critical issue in the U.S. over the short run. “[I]n the United States there are many competing managed care organizations that deliver care themselves and therefore, compared to European insurers, have much more effective and subtle tools to use to distort the level of quality of care,” the authors write. U.S. insurers also are experienced at identifying medical risk and may use the information at their disposal to design products that are unattractive to high-risk patients—including those with cancer and substance abuse disorders. The high number of consumers choosing health plans in the insurance exchanges may exacerbate the problem. Solving these vexing issues, the authors say, must be made a priority to prevent sick patients from receiving poorer-quality services or reduced access to care.

http://www.commonwealthfund.org/publications/in-the-literature/2015/oct/risk-selection-threatens-quality-of-care

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Comment:

By Don McCanne, MD

This report, supported by the Commonwealth Fund and published in Health Affairs, looks at European nations that use variations of market exchanges of private insurance plans (Belgium, Germany, Ireland, Switzerland and, especially, the Netherlands) to see what lessons on risk selection they may have for the United States. But are these the right lessons for us?

Private insurers in the United States have long been masters at figuring out ways of insuring the healthy, with their relatively low health care costs, while avoiding insuring individuals with greater health care needs. Although the Affordable Care Act prohibits insurers from refusing to cover individuals anticipated to have higher health care costs, we are seeing insurance innovations in gaming risk selection that substitute for medical underwriting, which sometimes still prevents patients from receiving the care that they should have.

The multi-payer system in the United States is infamous for the very high costs of the wasteful administrative excesses in our health care financing. In fact, some of these excesses are for the very purpose of ensuring the business success of the private insurers. So what efficiencies do the European systems that use marketplace exchanges of private plans have that might help the United States avoid the perversities of favorable risk selection on the part of the insurers?

The authors suggest the introduction of additional risk adjusters (more administration), systems to collect yet more data (more administration), introduction of risk-sharing strategies such as mandatory community-rated reinsurance or risk sharing between the regulator and the insurers (more administration), allowing insurers to charge their enrollees, within a band or range of acceptable charges, risk-adjusted health insurance premium rates (more administration), and balancing trade-offs of quality-skimping selection, efficiency, and affordability (more administration).

Not only would these “lessons” expand the administrative excesses of our system, but because of the trade-offs involved, further compromises in quality and equity would result. No matter what strategies are used, the private insurers will always find a way around them. That is inherent in their business-model DNA.

Instead of us looking for lessons in the European private insurance markets, it seems that these European nations should be looking for lessons from our neighbor to the North: Canada and its single payer model of health care financing. We would do well to do the same.

High-cost patients exit private Medicare Advantage plans

High-Cost Patients Had Substantial Rates Of Leaving Medicare Advantage And Joining Traditional Medicare

By Momotazur Rahman, Laura Keohane, Amal N. Trivedi and Vincent Mor
Health Affairs, October 2015

Abstract

Medicare Advantage payment regulations include risk-adjusted capitated reimbursement, which was implemented to discourage favorable risk selection and encourage the retention of members who incur high costs. However, the extent to which risk-adjusted capitation has succeeded is not clear, especially for members using high-cost services not previously considered in assessments of risk selection. We examined the rates at which participants who used three high-cost services switched between Medicare Advantage and traditional Medicare. We found that the switching rate from 2010 to 2011 away from Medicare Advantage and to traditional Medicare exceeded the switching rate in the opposite direction for participants who used long-term nursing home care (17 percent versus 3 percent), short-term nursing home care (9 percent versus 4 percent), and home health care (8 percent versus 3 percent). These results were magnified among people who were enrolled in both Medicare and Medicaid. Our findings raise questions about the role of Medicare Advantage plans in serving high-cost patients with complex care needs, who account for a disproportionately high amount of total health care spending.

From the Introduction

Each year Medicare beneficiaries can choose between two options for health coverage: traditional Medicare and Medicare Advantage. Although each option covers the same core set of benefits, the two may differ in terms of beneficiaries’ out-of-pocket expenses, choice of providers, and access to additional services. Approximately 30 percent of Medicare beneficiaries in 2014 were enrolled in Medicare Advantage plans.

Because Medicare Advantage plans receive prospective, capitated payments to finance and deliver services for their enrollees, they operate under strong incentives to manage their members’ health care costs. Policy makers have been concerned that capitated payments give Medicare Advantage plans an incentive to enroll healthier beneficiaries and to avoid enrolling those with chronic conditions. Indeed, a large body of literature based on data from the 1990s and early 2000s found that Medicare Advantage plans disproportionately enrolled healthier beneficiaries. This phenomenon, known as favorable risk selection, has historically yielded substantial overpayments to Medicare Advantage plans.

From the Discussion

We examined the relationship between use of hospital, nursing home, and home health care in 2010 and beneficiaries’ switching between Medicare Advantage and traditional Medicare by January 2011. Among traditional Medicare beneficiaries, we observed lower rates of switching into Medicare Advantage among people who used nursing home, home health, or acute inpatient care, compared with beneficiaries who did not use these services. In contrast, among Medicare Advantage beneficiaries, we found increased rates of switching into traditional Medicare among people who used nursing home and home health care, compared with beneficiaries who did not use these services.

Our results are consistent with other studies reporting that beneficiaries who report poorer health, use more health services, and have higher health care spending are more likely than their counterpart Medicare Advantage beneficiaries to leave Medicare Advantage plans, despite the recent reforms to the Medicare Advantage payment formula.

Our results raise questions about whether current Medicare Advantage regulations and payment formulas are designed to meet the needs of Medicare Advantage members who use postacute and long-term care. First, the enhanced payments to Medicare Advantage plans for dual eligibles or people who receive extended nursing home care do not appear to be effective in retaining these beneficiaries in Medicare Advantage plans. The unidirectional flow of these high-risk and often high-spending patients from Medicare Advantage to traditional Medicare appears to transfer responsibility to traditional Medicare just as patients enter a period of intensive health care needs.

There could be several reasons for the switching of high-risk Medicare Advantage enrollees. One possibility is that Medicare Advantage plans may not have sufficient incentives to spend their enhanced payments on better services for their beneficiaries.

Second, our findings suggest that Medicare Advantage members who use home health or nursing home services might be dissatisfied with the Medicare Advantage program. Medicare Advantage beneficiaries may find that their plans’ network restrictions make it harder to access these services that would be the case in traditional Medicare, creating an incentive to switch.

Additionally, some Medicare Advantage plans have been criticized for imposing high cost sharing for services such as the skilled nursing facility care that can be necessary for seriously ill beneficiaries.

Conclusion

We observed substantial switching from Medicare Advantage to traditional Medicare by beneficiaries who used nursing home and home health care, particularly those who were also eligible for Medicaid, and virtually no entry into Medicare Advantage plans by traditional Medicare beneficiaries who used these services or acquired dual eligibility. We found that a high proportion of beneficiaries with nursing home or home health care use choose to exit the Medicare Advantage program by the start of the next plan year. Thus, our study raises questions about the role of Medicare Advantage plans in serving high-cost patients with complex health care needs that span acute, postacute, and long-term care settings.

http://content.healthaffairs.org/content/34/10/1675.abstract

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The Medicare-HMO Revolving Door — The Healthy Go in and the Sick Go Out

By Robert O. Morgan, Ph.D., Beth A. Virnig, Ph.D., M.P.H., Carolee A. DeVito, Ph.D., M.P.H., and Nancy A. Persily, M.P.H.
The New England Journal of Medicine, July 17, 1997

Enrollment in Medicare health maintenance organizations (HMOs) is encouraged because of the expectation that HMOs can help slow the growth of Medicare costs.

Results

The rate of use of inpatient services in the HMO-enrollment group during the year before enrollment was 66 percent of the rate in the fee-for-service group, whereas the rate in the HMO-disenrollment group after disenrollment was 180 percent of that in the fee-for-service group.

http://www.nejm.org/doi/full/10.1056/NEJM199707173370306

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Comment:

By Don McCanne, MD

In 1997, The New England Journal of Medicine published a landmark article that showed that Medicare patients who enrolled in private Medicare HMOs exited them when they developed a need for a greater amount of health care: “The Medicare-HMO Revolving Door — The Healthy Go in and the Sick Go Out”

After nearly two decades of refinement of payment methods for the private Medicare Advantage plans, this new study from Health Affairs shows that “a high proportion of beneficiaries with nursing home or home health care use choose to exit the Medicare Advantage program.” Specifically, “Our results are consistent with other studies reporting that beneficiaries who report poorer health, use more health services, and have higher health care spending are more likely than their counterpart Medicare Advantage beneficiaries to leave Medicare Advantage plans, despite the recent reforms to the Medicare Advantage payment formula.”

The healthy go in and the sick go out. With Medicare Advantage plans, the patients and the taxpayers end up as losers.

Not Much to Show for Nation’s High Cost of Care

System must change dramatically to improve outcomes, physician says

By Caroline Poplin, M.D., J.D.
MedPage Today, Sept. 28, 2015

For the last 30 years or so, Americans have pondered the U.S. healthcare cost conundrum: all other developed countries spend significantly less than we do on healthcare — whether that’s measured as a percentage of Gross Domestic Product or per capita — yet achieve better outcomes and cover all their residents. What is our problem?

As readers know, one needs a correct diagnosis to achieve a successful treatment.

In recent years, U.S. health policy experts have advanced a novel explanation: our over-generous insurance plans, our fee-for-service reimbursement system, and our failure to manage healthcare providers all generate huge waste — up to 30% of total spending — mostly in overutilization of services that are of low value, or no value, to anyone.

For example, classical economics predicts that if a product is free at the point of service, consumers will demand an unlimited amount. (Of course, even fully insured patients don’t regard healthcare as exactly free — they have already paid substantial premiums, and may wish to get something for their money besides peace of mind.)

Nevertheless, analysts on both sides of the political spectrum insist that “healthcare consumers” — that is, patients — need more “skin in the game” at the point of service — hence policy leaders firmly oppose “first-dollar” coverage, Medigap plans (they cover co-pays and deductibles for Medicare beneficiaries who purchase them), and so-called “Cadillac” employer-sponsored insurance plans, which under the Affordable Care Act (ACA) will be taxed at 40% starting in 2018.

With their own money at risk, the theory goes, patients will request only truly valuable services, and will shop for the best price — just like buying a car.

On the supply side, policymakers call for radical reform of the reimbursement and delivery of healthcare. Reformers believe that fee-for-service reimbursement encourages doctors and hospitals to maximize the volume of services. Instead, they should be paid only for “value.” Ideally, payers should pay providers “capitated” fees — a fixed fee (maybe risk-adjusted) for each patient to cover the cost of his or her care — which will force providers to practice with maximum efficiency.

The great appeal of this approach is that less care is better care: reducing care generates great outcomes while simultaneously lowering costs. Note that American analysts rarely mention price: they assume that market competition will drive down prices, or that fewer services will reduce overall cost even if prices stay the same.

Reformers wasted no time putting their theories into practice: both Medicare and the ACA authorize pilot projects based on this novel, market-based theory.

So far, results have been mixed: some improvement in selected “quality” measures, less success on reducing cost. This should not come as a surprise. While American reform theory may be elegant, its underpinnings are weak.

For example, a 2012 comparative study by the Commonwealth Fund raised serious questions about the overutilization hypothesis: the fund found that the U.S. “ranked at the bottom for the number of [per capita] doctor consultations … had shorter hospital stays,” and “a smaller number of hospital beds.”

Nor do increased out-of-pocket costs to patients selectively reduce their use of low-value services. In fact, a classic RAND study in 1982 demonstrated that when costs go up, consumers cut back on all medical services, valuable and wasteful alike. (This is not a problem for insurers, of course.)

Finally, competition rarely reduces the price of healthcare services or health insurance in the U.S.

In general, competition only drives prices down to marginal cost under specific conditions: there are so many suppliers and consumers that no one can affect price; consumers can easily switch from one supplier to another; everyone has complete information; and the product is fungible (all the same — think gasoline) or easily compared (groceries).

In many parts of the U.S., however, healthcare markets are limited (only one or two hospitals), or health insurance markets are limited, or both. Products are complex and difficult to compare. There may be competition, but it is usually on “quality,” not price. Indeed, patients often pay different prices for the same service, based on their insurance plans. And the situation is only getting worse as mergers among large health insurers and hospital chains increase consolidation in both markets.

American health costs are high because the for-profit system has only driven prices higher: radically restructuring healthcare delivery and reimbursement is unlikely to change that. Indeed, one could argue that the U.S. healthcare community favors the new theory precisely because it allows prices — and profits — to stay high.

Other developed countries fare better than we do because they keep healthcare prices reasonable, by regulation or negotiation. Insurance is public, non-profit, or tightly regulated. Insurance benefits are comprehensive and largely standardized, reducing transaction costs and confusion, while ensuring necessary care. Meanwhile, reimbursement remains mostly fee-for-service, and healthcare delivery remains decentralized.

We can’t achieve European results without European methods. We should build on traditional Medicare, which currently regulates fees for doctors and hospitals. Congress should authorize the Centers for Medicare and Medicaid Services to negotiate prices for drugs and other medical services, and then gradually extend Medicare to younger Americans.

Indeed, if we believe that all Americans should receive adequate healthcare, “Medicare for all” may be the only system we can afford.

Caroline Poplin, M.D., J.D., is an attorney and internist in Bethesda, Md. She is a former staff internist for the National Naval Medical Center, and currently practices medicine part-time at the Arlington Free Clinic in Virginia. She also consults for law firms on Medicare and Medicaid fraud.

http://www.medpagetoday.com/PublicHealthPolicy/HealthPolicy/53745

Need a real discussion on humane, cost-effective health care system

By William M. Fogarty Jr., M.D.
St. Louis Post-Dispatch, Letters, Oct. 6, 2015

In his article (“Again? Health Care Debate Expands for 2016,” online Oct. 2) Ricardo Alonso-Zaldivar outlines the three approaches that the various candidates for the presidential nomination offer on health care. They range from the single-payer approach espoused by Bernie Sanders, through the middle ground basically supporting the status quo offered by Hillary Clinton, to the “repeal and replace” position of the Republican contenders. Unfortunately, the Republicans offer no details of their replacement and also attack Medicare and Medicaid, which serve some 100 million Americans, without offering a viable alternative.

The writer states that the single-payer option would call for “a massive tax increase” not allowing for the fact that that increase would be more than offset by replacing the premiums now paid to insurance companies and the $400 billion that would be saved in administrative costs and insurance company profits, not to mention the savings in drug and device costs that would result from competitive purchasing.

Hopefully, we will move beyond the circus we are now enduring in the Republican primary run-up to a real discussion of the issues important to this country. Among those is how we are going to craft a humane, cost-effective, high-quality heath care system that serves everyone. Among the options being discussed, the single-payer system is the only one with the potential to fulfill that goal.

Dr. William M. Fogarty Jr. resides in Webster Groves.

http://www.stltoday.com/news/opinion/mailbag/need-a-real-discussion-on-humane-cost-effective-health-care/article_c0017049-ab9c-56fb-9514-238d4e4e37d7.html

Risk corridor stabilization fund – another ACA failure

Big shortfall in Obamacare risk program could hurt insurers

By Tami Luhby
CNN Money, October 2, 2015

A key federal program designed to cushion health insurers’ risks in the Obamacare exchanges has a massive shortfall, which could throw some insurers into financial turmoil.

Insurers requested $2.87 billion in so-called “risk corridors” payments for 2014, but will only receive $362 million, or 12.6%, said the Centers for Medicare & Medicaid Services, which oversees Obamacare.

The risk corridors program’s goal is to help insurers transition into the individual exchanges, which opened in 2014. Insurers had a tough time setting premiums since they didn’t know how sick their new customers would be.

Under the three-year program, insurers whose premiums exceeded claims pay into the fund, while their peers who didn’t charge enough premiums to cover claims could draw from it.

But too many insurers miscalculated when they set their rates for 2014.

“Insurers underestimated the riskiness of their customer base and set their premiums too low,” said Tim Jost, a health law professor at Washington and Lee University School of Law.

The shortfall could put a financial strain on some insurers, especially some smaller ones who were counting on the funds. Some firms have reported losses in their Obamacare line of business, while four health insurance cooperatives are shutting down because of financial pressures.

Obamacare insurers have already set their premiums for 2016 and can’t adjust them now. The shortfall in risk corridor payments could prompt insurers to raise premiums in future years or exit the program.

The administration said the remaining 2014 risk corridor claims will be paid out of the 2015 and, if needed, the 2016 collections.

Insurers are still getting billions from two other Obamacare risk programs. They will receive $7.9 billion from the reinsurance program, designed to spread the cost of very large insurance claims across all insurers. And they will receive $4.6 billion from the risk adjustment program, which requires insurance companies with healthier consumers in a state to help offset some of the costs of those insurance companies with sicker customers in that state.

http://money.cnn.com/2015/10/02/news/economy/obamacare-insurers/index.html

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Health Policy Briefs

Health Affairs, February 19, 2015

With the new restrictions on premium setting and the unpredictability of medical expenses from the newly insured, insurers faced a high level of uncertainty when setting their premiums. To buffer insurers from high losses in the initial years, keep premiums affordable, encourage insurers to participate in the Marketplaces, and minimize year-to-year premium fluctuations, the ACA authorized three premium stabilization programs: risk adjustment, reinsurance, and risk corridors.

The risk corridor program has proven to be one of the more controversial aspects of the ACA with critics, including a number of Republicans in Congress, characterizing the program as an insurer bailout. They argue that as a result of HHS and state officials putting pressure on insurers to keep premiums low in the Marketplaces, the federal government will end up picking up the tab to bail out insurers if they underpriced.

Critics also claim that the program encourages insurers to underprice their plans in order to gain market share, knowing the government will offset their losses.

While the Consolidated and Further Continuing Appropriations Act of 2015, which funded the government for the 2015 fiscal year, did give HHS the authority to collect user fees, an amendment was included that specifically prohibited HHS from transferring money from either trust fund. The amendment did not eliminate the risk corridor program, nor did it prevent HHS from using payments received from insurers to pay out claims under the program (that is, user fees), but it effectively made the risk corridor program budget neutral unless HHS can find another source of funding.

If risk corridor claims exceed receivables and HHS does not find an alternative source of funding, it seems likely it will revert to its earlier proposal to prioritize paying off shortfalls from previous years before making new payments. If the shortfalls were great enough, this could effectively eliminate payments to insurers for the final two years of the program.

http://www.healthaffairs.org/healthpolicybriefs/brief.php?brief_id=134

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Comment:

By Don McCanne, MD

Although the media are covering this story as a shortfall in the risk corridor stabilization funds, the real story here is about the behavior of private insurers competing in the insurance exchanges established under the Affordable Care Act (ACA). An explanation is in order.

So what are the risk corridors and why do they exist? It was understood that insurers could be exposed to significant losses if they attracted more than an expected number of enrollees who had greater health care costs. So for the first three years, a portion of losses above a certain threshold (the upper margin of the corridor) would be covered by a stabilization fund. Likewise, if the insurers were successful in enrolling more individuals with very low health care costs (below the lower margin of the corridor), those insurers would be required to pay a portion of their net gain into the stabilization fund (“user fees”).

So how would private insurers respond? For the first year of marketing plans on the exchanges, they would want to have lower, competitive premiums in order to corner market share. Their losses for high cost enrollees would be largely covered (up to 80%) so they could accept some losses for those with average health care needs, knowing that they could later adjust fees modestly upwards after having gained market dominance (a version of the insurance underwriting cycle). As would be expected of the private insurers who are masters at gamesmanship, they were able to show that not many of their enrollees fell under the lower margin of the corridor, thus their payments to the stabilization fund (user fees) were kept to a minimum.

As a result, the stabilization fund is able to cover only about 13% of of the losses above the upper margin of the corridor. Although HHS says that they would find the funds, Congress has created barriers to using funds other than the user fees authorized by the risk corridor stabilization program. Since they are budgeting 2015 and 2016 user fees to pay for 2014 losses, obviously the funds will be rapidly depleted, with little or none available for the second and third years of the program.

Risk corridors, risk adjustment, and reinsurance are not for the benefit of patients, rather they are to protect the insurers. Not only do they add to our profound administrative waste, they also open up opportunities for insurers to profit even more through chicanery and gamesmanship.

We could completely do away with this and all of the other insurer excesses by simply enacting a single payer national health program. Why not now? Are not the voters in charge?

Time for single-payer health care

By Katie Myers
The Albuquerque Journal, Oct. 4, 2015

When I decided that I was going to be a doctor, I had many preconceived notions about what that meant.

I pictured myself coming upon a mass casualty accident and saving everyone’s lives single-handedly. I thought that I would make a difference every day by curing people’s ailments.

Obviously, I realize now, that saving everyone in a mass casualty accident is a bit grandiose, and as I progress further in my education I have come to the harsh realization that making a difference is often going to be out of my hands as a physician due to our current health care system.

The system is funded by more than 17 percent of our GDP – more than any other nation in the world – and it still leaves 29 million people in America uninsured.

This does not include the 31 million Americans that are underinsured, meaning that they pay over 10 percent of their household income on out-of-pocket medical expenses, even though they have insurance. And that doesn’t include premiums.

This leads to people not going to the doctor due to out-of-pocket costs that they cannot afford. It leads to debt and bankruptcy in families that are already dealing with the overwhelming stress that comes with illness.

These injustices are too real for those of us in the medical field and for our patients who are attempting to navigate this system.

Fortunately, there is a solution to this issue: single-payer health care.

Single-payer health care is the expansion and improvement of Medicare to everyone.

Often the topic of single-payer health care causes a negative reaction and people are quick to say, “This would never work in the U.S.” But, before you dismiss it, I urge you to take a moment and think about it.

Think about the last time you went to the doctor for yourself or with a loved one. During the visit, did you find yourself concerned with the cost of the treatment or test that had to be done? Were you worrying about whether your insurance was going to cover the procedure that you or your loved one needed to have done to feel better?

If you’re like me, you answered yes to these questions and you are directly affected by our failing health care system.

Now imagine going to the doctor and not worrying about these things. Imagine going to the doctor and worrying only about you or your loved one getting better.

Students for a National Health Program (SNaHP) is a growing organization in medical schools across the country. We are students that rally together to find new ways to advocate for this single-payer system.

We do this because every day we see the results of this failing health care system.

We do this for our future patients as well as our families, and our communities.

We do this because, when we received our white coats, we took an oath that we would consecrate our lives to the service of humanity and that the health of our patients would be our first consideration.

Our current health care system is hindering our ability to keep this oath.

For all of these reasons, SNaHP chapters across the country came together on Oct. 1st for a national day of action and demanded a system where our citizens will not go bankrupt paying for their medical bills. A system that is accessible to all. A system that is fair.

We held teach-ins, rallies, and a luminaria vigil to pay our respects to the tens of thousands of people who die each year due to lack of insurance.

This is not the end of our fight for an equitable health care system. We ask that you write your representatives and urge them to vote for the Expanded and Improved Medicare for All Act – H.R. 676.

We hope that you will be as inspired about this issue as we are so that we can all work together for a better, more just health care system. 

Katie Myers is a University of New Mexico medical student.

http://www.abqjournal.com/653709/opinion/time-for-singlepayer-health-care.html

#BlackLivesMatter: Physicians Must Stand for Racial Justice

By White Coats for Black Lives (WC4BL) National Working Group
American Medical Association Journal of Ethics, October, 2015

Racism is one of the major causes of health problems in the United States. Between 1970 and 2004, the Black-white mortality gap resulted in more than 2.7 million excess Black deaths1, making racism a more potent killer than prostate, breast, or colon cancer2. Physicians are intimately involved with institutions that contribute to the victimization of Black people and other people of color. As is widely documented, Black and Latino patients are less likely to receive the care they need, including adequate analgesia, cancer screening, and organ transplants3-6. This is due both to physician bias and to the health care payment structure’s financial disincentives for the care of people of color7—clinicians are paid less to care for patients who are uninsured, underinsured, or publicly insured, and these patients are disproportionately people of color. As a consequence, people of color are often denied access to the health care they need8,9.

These disparities in access to health care exacerbate the harm that social structures and policies cause to the health of people of color. Black and Latino people are disproportionately victimized by police violence, mass incarceration, and poverty10-12. Moreover, despite perceived improvements, rates of racial segregation across the country remain comparable to levels in the 1940s, and people of color face discrimination in their efforts to access adequate housing, quality education, and meaningful employment13-16. The harmful effects of structural inequity are augmented by the subjective experience of racism: for example, awareness of one’s race is correlated with increased diastolic blood pressure among Black patients17.

Addressing racism and its consequences, therefore, should be a central task of American medicine; physicians must work both within and outside the health care system to eliminate inequities in access to and delivery of care. Health professionals and community organizations ranging from the Black Panther Party to the National Latina Institute for Reproductive Health have long proposed effective strategies for addressing racism to improve the health of people of color, including expansion of free clinics, increased research on diseases affecting people of color, and legislative establishment of paid parental leave18,19. Recent incidents and protests in Charleston, Baltimore, New York, and other cities across the country have reminded us of the urgency of acting on these and other proposals to address racism in medicine.

In particular, we, as members of the National Working Group of the medical student organization White Coats for Black Lives, suggest four ways that physicians and other health professionals can immediately pursue racial justice. The first is to more aggressively recruit, support, and promote Black, Latino, and Native American people in medicine to ensure that the physician workforce reflects the diversity of the United States. Black and Latino people represent roughly 30 percent of our nation’s population but make up only 8.5 percent of the physician workforce20. Physicians of color are more likely to provide care for America’s underserved communities, and patients of color report higher satisfaction when their doctor shares their racial background21-23. Despite the Association of American Medical Colleges’ Project 3000 by 200024, the past three decades have witnessed little growth in the population of Latino, Black, and Native American physicians20. Increasing the numbers of Black, Latino, and Native American doctors is a key step in eliminating health inequities.

Secondly, hospitals and practices must take action to eliminate the significant impact of implicit racial biases on the care of patients of color7. To counteract these subtle forms of racism, institutions must routinely administer implicit association tests to their medical staffs to make them cognizant of their unconscious biases and then train their medical staffs to consciously overcome those biases when delivering care25. Furthermore, hospitals should create formal and informal structures to encourage accountability for incidents that may have involved racism. This can be done by fostering a work environment that makes it safe for colleagues to question each other’s biased actions and by using structured venues such as morbidity and mortality conferences to discuss ways that racism may have impacted the quality of patient care.

Thirdly, physicians should join community members in advocating for a single-payer health care system as a means of eliminating cost-associated barriers to care. In addition to improving access for all patients, a single-payer system would eliminate insurance-status discrimination and ensure that reimbursements for services provided to white patients and patients of color are equal.

Finally, health care workers must recognize that our responsibility to our patients goes beyond physical exams, prescriptions, and surgical interventions; we must work to alter socioeconomic and environmental factors, including structural racism, that directly affect our patients’ health. The manifestations of structural racism are varied and ubiquitous; addressing them will require joining movements to increase the minimum wage, end criminalizing school discipline practices, and develop mixed-income housing, among many others. In doing so, physicians will need to partner with and take direction from community members who have experienced systemic oppression and are dedicated to working to dismantle it. We will not be able to solve the problems of racism in our society and in our health care system without the input of those most affected by it. In working to combat structural racism, physicians must not only listen to people of color in their practices and communities, but also amplify those voices while advocating for equitable social structures. Theprivilege that physicians possess within society and within the professional hierarchy of medicine provides them with power that can be used to spearhead policy changes to advance racial justice locally and nationally. Using this “physician privilege” to advocate for social change is necessary if we are to eradicate the systemic illness that is racism.

References

  1. Rodriguez JM, Geronimus AT, Bound J, Dorling D. Black lives matter: differential mortality and the racial composition of the US electorate, 1970-2004. Soc Sci Med. 2015;136-137:193-199.
  2. American Cancer Society. Estimated deaths for the four major cancers by sex and age group, 2015. http://www.cancer.org/acs/groups/content/@editorial/documents/document/acspc-044509.pdf. Accessed June 28, 2015.
  3. Agency for Healthcare Research and Quality. 2014 National healthcare quality and disparities report. Rockville, MD: Agency for Healthcare Research and Quality; May 2015. http://www.ahrq.gov/research/findings/nhqrdr/nhqdr14/2014nhqdr.pdf. Accessed June 28, 2015.
  4. Tamayo-Sarver JH, Hinze SW, Cydulka RK, Baker DW. Racial and ethnic disparities in emergency department analgesic prescription.Am J Public Health. 2003;93(12):2067-2073.
  5. Agency for Healthcare Research and Quality. 2013 National Healthcare Quality Report. Rockville, MD: Agency for Healthcare Research and Quality; May 2014. http://www.ahrq.gov/research/findings/nhqrdr/nhqr13/2013nhqr.pdf. Accessed June 28, 2015.
  6. Churak JM. Racial and ethnic disparities in renal transplantation. J Natl Med Assoc. 2005;97(2):153-160.
  7. Chapman EN, Kaatz A, Carnes M. Physicians and implicit bias: how doctors may unwittingly perpetuate health care disparities. J Gen Intern Med. 2013;28(11):1504-1510.
  8. Hing E, Decker S, Jamoom E. Acceptance of new patients with public and private insurance by office-based physicians: United States, 2013. NCHS Data Brief. 2015;(195):1-8.
  9. Kaiser Family Foundation. Health coverage by race and ethnicity: the potential impact of the Affordable Care Act. March 13, 2013. http://kff.org/disparities-policy/issue-brief/health-coverage-by-race-and-ethnicity-the-potential-impact-of-the-affordable-care-act/. Accessed June 28, 2015.
  10. Sadler MS, Correll J, Park B, Judd CM. The world is not black and white: racial bias in the decision to shoot in a multiethnic context. J Soc Issues. 2012;68(2):286-313.
  11. Kramer MR, Hogue CR. Is segregation bad for your health?Epidemiol Rev. 2009;31(1):178-194.
  12. The Sentencing Project. Reducing racial disparity in the criminal justice system: a manual for practitioners and policymakers. Washington, DC: The Sentencing Project; 2008. http://www.sentencingproject.org/doc/publications/ rd_reducingracialdisparity.pdf. Accessed June 28, 2015.
  13. Shapiro T, Meschede T, Osoro S. Research and policy brief: the roots of the widening racial wealth gap: explaining the black-white economic divide. Waltham, MA: Brandeis University Institute on Assets and Social Policy; February 2013. http://iasp.brandeis.edu/pdfs/Author/shapiro-thomas-m/racialwealthgapbrief.pdf. Accessed June 28, 2015.
  14. Fryer RG Jr, Pager D, Spenkuch JL. Racial disparities in job finding and offered wages. J Law Econ. 2013;56(3):633-689.
  15. American Psychological Association Presidential Task Force on Educational Disparities. Ethnic And Racial Disparities in Education: Psychology’s Contributions to Understanding and Reducing Disparities. August 3, 2012. http://www.apa.org/ed/resources/racial-disparities.pdf. Accessed June 28, 2015.
  16. Williams DR, Collins C. Racial residential segregation: a fundamental cause of racial disparities in health. Public Health Rep.2001;116(5):404-416.
  17. Brewer LC, Carson KA, Williams DR, Allen A, Jones CP, Cooper LA. Association of race consciousness with the patient-physician relationship, medication adherence, and blood pressure in urban primary care patients. Am J Hypertens. 2013;26(11):1346-1352.
  18. Nelson A. Body and Soul: The Black Panther Party and the Fight Against Medical Discrimination. Minneapolis, MN: University of Minnesota Press; 2013.
  19. Center for Reproductive Rights; National Latina Institute for Reproductive Health; SisterSong Women of Color Reproductive Justice Collective. Reproductive injustice: racial and gender discrimination in US health care: a shadow report for the UN Committee on the Elimination of Racial Discrimination. 2014. http://www.reproductiverights.org/sites/crr.civicactions.net/files/documents/CERD_Shadow_US.pdf. Accessed July 24, 2015.
  20. Association of American Medical Colleges. Diversity in the physician workforce: facts & figures 2014. http://aamcdiversityfactsandfigures.org. Accessed June 28, 2015.
  21. Marrast LM, Zallman L, Woolhandler S, Bor DH, McCormick D. Minority physicians’ role in the care of underserved patients: diversifying the physician workforce may be key in addressing health disparities. JAMA Intern Med. 2014;174(2):289-291.
  22. Saha S, Komaromy M, Koepsell TD, Bindman AB. Patient-physician racial concordance and the perceived quality and use of health care.Arch Intern Med. 1999;159(9):997-1004.
  23. Cooper LA, Roter DL, Johnson RL, Ford DE, Steinwachs DM, Powe NR. Patient-centered communication, ratings of care, and concordance of patient and physician race. Ann Intern Med. 2003;139(11):907-915.
  24. Nickens HW, Ready TP, Petersdorf RG. Project 3000 by 2000: racial and ethnic diversity in US medical schools. New Engl J Med. 1994;331(7):472-476.
  25. Green AR, Carney DR, Pallin DJ, et al. Implicit bias among physicians and its prediction of thrombolysis decisions for black and white patients. J Gen Intern Med. 2007;22(9):1231-1238.

White Coats for Black Lives (WC4BL) is a national medical student organization devoted to safeguarding the lives of patients through the elimination of racism. The WC4BL National Working Group endeavors to raise awareness of racism as a public health concern that threatens the lives and health of people of color, end racial discrimination in the delivery of health care, and prepare future physicians to be advocates for racial justice. WC4BL encourages medical professionals to create a physician workforce that reflects the diversity of our nation by actively recruiting and supporting Black, Latino, and Native American people through medical school and into their careers.

http://journalofethics.ama-assn.org/2015/10/sect1-1510.html

Case Med Students Say Obamacare Doesn’t Cut It, Rally for Health Care Reform

By Sam Allard
Cleveland Scene, October 2, 2015

About 40 people gathered at Case Western Reserve University Thursday evening as a part of a national day of action calling attention to “America’s failing health care system.”  

More than 30 universities participated nationwide in the #TenOne (October 1st) “Health Care for All” event. At Case, the Students for a National Health Program (SNaHP), hosted a march, speakers, and a candlelight vigil. They’d been planning the event since April.

Second-year Case medical student Vanessa Van Doren was one of the national organizers and helped put together the local event, which also commemorated the 50th Anniversary of Medicare. 

“The Affordable Care Act is an improvement,” she told Scene, “but there’s still a lot to be done.” 

Van Doren mentioned that even with Obamacare, 30 million Americans are left uninsured, and that tens of thousands of people die every year due to a lack of medical care. 

“Medical bills are the leading cause of bankruptcy in the U.S., and research shows nearly 80 percent of those declaring bankruptcy due to medical debt had insurance at the onset of their illness,” read a SNaHP press release. “Our patients need and deserve better.”

Van Doren spoke Thursday evening, after students, carrying signs, processed around the medical campus and University Hospitals.

“Ultimately, we’re all here because we believe it is fundamentally wrong for some people to live shorter, sicker lives simply because they can’t afford medical care,” Van Doren said in her speech. “Tens of thousands of people in the U.S. die every year because they don’t have access to life-saving care. This is indefensible, and it needs to stop.”

Van Doren said the goal of the #TenOne national day of action was to bring awareness to America’s failing health system and to raise the alarm, especially among medical students, about the necessity of single-payer health care reform. 

http://www.clevescene.com/scene-and-heard/archives/2015/10/02/case-med-students-say-obamacare-doesnt-cut-it-rally-for-health-care-reform

Here they come again: Broader health care debate for 2016

By Ricardo Alonso-Zaldivar
WNYT.com (Albany, N.Y.), Oct. 2, 2015        

WASHINGTON (AP) — After seven years of the political drama known as “Obamacare,” you might think voters would be tired of big ideas for revamping health care. If so, the presidential candidates seem to have missed the memo.

The 2016 hopefuls in both parties are offering a full spectrum of options, from a system wholly run by the federal government to dialing back Washington’s lead role. Much is promised by the candidates, but each approach has pitfalls.

On the left, part of the appeal of Vermont independent Sen. Bernie Sanders is his years-long advocacy of “single payer,” a tax-supported, Medicare-like plan for all. The idea is in the political DNA of liberals, and Sanders as president would lead a movement to make it happen, his campaign says.

On the right are the Republicans, united on repealing President Barack Obama’s health care law, but unable to agree on what they would replace it with. They wouldn’t stop with the Affordable Care Act, either. Republicans also want curbs on Medicaid, to reduce spending and let states, not Washington, set the tone. Medicaid covers low-income and disabled people.

In the middle — if one still exists on such a polarized issue — is Democrat Hillary Rodham Clinton. She would keep the basic structure of Medicare, Medicaid and the Obama health law while making incremental changes. This week she proposed repealing an insurance tax in the health law that’s opposed by unions and big business but seen by experts as a needed brake on costs. She also wants to curb prescription drug prices and limit insurance cost-shifting to consumers.

“The only person not in favor of ‘repeal and replace’ is Hillary Clinton,” quips Republican economist Douglas Holtz-Eakin. “There is a debate being presented to the American people: Do you want to go further left, or do you want to go in the direction conservatives are advocating? The person who is basically arguing for the status quo is Hillary Clinton.”

A look at the three approaches, and their potential drawbacks:

SINGLE PAYER

If Sanders keeps gaining traction, the wonkish term for a government-run health care system could become a household word. His supporters say Obama’s hard-fought health overhaul hasn’t done nearly enough.

“People are still one illness away from becoming bankrupt,” said Dr. Deb Richter, who practices near Montpelier, Vermont, and focuses on addiction treatment. “Obamacare was hyped as this savior, and it has not been that.”

Supporters say having the government take charge of health care finances would slow the growth of spending, keep things affordable for patients, and improve overall quality.

A major pitfall is the switch from employer-based and private coverage to the single-payer plan. Money that employers and individuals now pay for premiums would have to be diverted to government coffers — a massive tax increase.

“It’s a dead end,” said Princeton sociologist Paul Starr, a historian of the U.S. health care system. Supporters “don’t face up to the significant tax changes that would be necessary.”

REPEAL AND REPLACE

The Supreme Court upheld Obama’s law, and the president won re-election in 2012. That didn’t settle the debate, but 2016 may.

“For Republicans it’s their last chance to litigate the Affordable Care Act,” said Jim Capretta, an expert on entitlement programs at the conservative Ethics & Public Policy Center in Washington. “If they lose the election, the ACA is likely to become even more entrenched.”

‘Repeal’ is a winning issue with the GOP’s political base, but the ‘replace’ part gets tricky because Republicans don’t agree on an alternative. In the general election, the GOP counterproposal will be measured against the health care law’s progress in reducing the number of uninsured. A plan that repeals federal mandates and reduces insurance subsidies would probably leave more people uncovered.

Republican front-runner Donald Trump says his replacement plan would be different. He’d make sure everybody in the country is covered, something not even Obama accomplishes. Trump says he’d make a deal with hospitals, and most people would still have private coverage.

“There is not nearly enough to go on from Trump’s statements to assess what he actually has in mind,” said Capretta.

But the biggest pitfall for Republicans could be Medicare, not “Obamacare.” The party has previously advocated privatizing the insurance program for older Americans. In 2016, that would be asking for trouble.

“Seniors have been tilting Republican in the last elections,” said Robert Blendon, a public opinion expert at the Harvard T.H. Chan School of Public Health. “The only thing that could get them to tilt the other way is a Medicare proposal.”

CONTINUITY, MOSTLY

Hillary Clinton established her credentials on health care in the 1990s, although she and her husband, then-President Bill Clinton, failed to pass the overhaul legislation they proposed. She lost the 2008 Democratic nomination to Obama, but he adopted key parts of her health plan.

This time, Clinton is promising to build on Obama’s coverage expansion and smooth its rough edges, while keeping Democrats’ traditional commitment to Medicare and Medicaid.

The drawback is that Clinton’s middle way may be seen as uninspiring. “I think there is a hunger among Democrats to see something more happen,” Blendon said.

http://wnyt.com/article/stories/s3923639.shtml

Can Sec. 1557 be used to prevent discriminatory adverse tiering?

The Section 1557 Regulation: What’s Missing, And How We Can Include It

By Douglas Jacobs
Health Affairs Blog, September 21, 2015

Kristin Agar, a 63-year-old social worker, was diagnosed with lupus in 2008, a rare disease in which the body’s own immune system can cause serious damage to the kidneys, brain, skin, and joints. Unfortunately, despite having insurance coverage, Kristin has found that the drug she needs to treat her lupus is unaffordable. All around the United States, Kristin joins other patients with chronic conditions like HIV, Hepatitis C, Multiple Sclerosis, Rheumatoid Arthritis, and Leukemia, who are having trouble paying for their medications.

In June, Robert Restuccia and I wrote a Health Affairs Blog post showing that discrimination in our health care system is evolving. Some insurers that once refused outright to offer coverage to patients like Kristin are now resorting to more surreptitious means to discourage enrollment, like increasing the cost of all medications for certain conditions. This practice, called “adverse tiering,” has been regulated under Section 1302 of the Affordable Care Act (ACA), which grants the Department of Health and Human Services (HHS) the authority to define essential health benefits under the ACA.

However, the Section 1302 regulation has so far been limited. The rule states that adverse tiering may be discriminatory, but also appears to allow an exemption for expensive drugs like Kristin’s lupus medication. Additionally, insurers that are “caught” practicing adverse tiering only have to provide written justification for their actions to HHS or comply by fixing their benefit design.

Even without practicing adverse tiering, insurers could discourage the most expensive beneficiaries from enrolling by increasing the cost of wheelchairs, nursing homes, or even specific surgeries. If HHS wanted to categorize any future insurance practices as discrimination under Section 1302, the regulatory process could take years. As such, these new forms of discrimination have prompted many to call on the Obama Administration for a stronger response.

The Section 1557 Regulation

Earlier this month, over five years after the Affordable Care Act was adopted, the Obama Administration finally proposed the highly anticipated rule that implements the ACA’s main nondiscrimination provision: Section 1557. The rule prevents discrimination on the basis of race, color, national origin, sex, age, and disability, and broadly applies to all health programs and activities that receive assistance through HHS.

For those who have experienced discrimination in its many forms, the regulation includes a number of provisions to protect consumers. Each health entity must provide appropriate aids and services to those with limited English proficiency and disabilities. The rule extends protections for transgender persons unlike ever before, including it as a form of sex discrimination. Furthermore, all services must be made available for gender transition (like a hysterectomy) that are available to a person seeking non-transition related care. All transgender persons must be treated consistent with their own gender identity.

The proposed rule also establishes a private right of action, giving individuals the ability to file a lawsuit under Section 1557 (courts had already begun to authorize private Section 1557 lawsuits, but this makes it official). This is an important step forward, because unlike the Section 1302 regulation, insurers will be highly motivated to comply with the 1557 regulation or face costly litigation. Insurers will think twice about changing their benefit design to discourage enrollment by individuals of a certain race, color, national origin, sex, age, and disability. Instead of taking years to pass a new regulation, a private cause of action allows the justice system to “keep pace” with quickly evolving insurer practices.

However, these positive developments are tempered by some noticeable omissions. Namely, the rule is conspicuously silent about discrimination on the basis of health status. As Timothy Jost stated in his recent post, “Surprisingly, the proposed rule does not directly address one of the most salient current discrimination questions: whether insurers can impose high cost sharing or otherwise limit access to expensive drugs needed by certain disabled populations.”

Kristin Agar, who can’t afford her lupus medication, may not be assisted by the Section 1557 regulations. Insurers could continue to discourage enrollment by the sickest consumers through manipulation of their benefit designs.

Without directly addressing the issue, HHS seems to have made a distinction between two different types of discrimination: discrimination by categorically excluding certain individuals from care, and discrimination by “pricing out” certain enrollees by making specific services unaffordable. In other words, making drugs or services unaffordable seems to be an effective way for insurance companies to discourage enrollment and improve their bottom lines.

The reticence to address “price-based” discrimination likely stems from insurers historically charging different prices for medications and services. Insurers argue that this pricing structure allows them to encourage the use of more low-cost services and medications.

However, this omission even has the potential to undermine the very forms of discrimination that the proposed Section 1557 regulation aims to protect against. For example, despite the new transgender protections in the rule, plans could still discriminate against transgender people by making hormonal treatments and transition-related care unaffordable. A plan could more broadly still discriminate on the basis of sex by increasing costs for medications predominantly used by women (like breast cancer treatment), increasing costs for pregnancy care, or severely limiting the number of gynecologists in the plan network. It is clear that in order to have a strong Section 1557 regulation, HHS must also address cost.

A Way Forward

HHS should adopt a standard way of addressing cost-based discrimination in the final Section 1557 rule. When does changing the cost of a drug or service make it “unaffordable,” thus discouraging enrollment and constituting discrimination? The answer to this question appears in other ACA regulations.

The Internal Revenue Service (IRS) defines “unaffordable” in the ACA as a percentage of income, which could set a standard for price-based discrimination as well. An “unaffordable” medication or service would become discriminatory if there is no lower-cost, but similarly efficacious drug or service. This would preserve an insurer’s ability to encourage the selection of lower cost drugs and services, while still protecting consumers from discriminatory pricing schemes. Even if the final Section 1557 regulation does not include cost-based discrimination, standards of discrimination may evolve with ongoing litigation. As individuals increasingly file Section 1557 cases, it is entirely possible that courts will find cost-based discrimination unlawful.

However, Kristin Agar and others with chronic conditions need more than a federal regulation recognizing cost-based discrimination: HHS should ban discrimination on the basis of health conditions in their final rule. HHS has the authority to interpret Section 1557 broadly as part of an overall statutory and regulatory regime to make health care more accessible to those who need it the most, and also have the responsibility to counter long standing and pervasive discriminatory practices by insurers.

In the absence of an explicit ban, another way to achieve Section 1557 protection against discrimination is for HHS or courts to categorize certain diseases as “disabilities.” Courts have historically been reluctant to do this, defining a “disability” as being restricted to an “impairment that substantially limits one or more major life activities.”

However, this was before the passage of the Americans with Disabilities Act Amendments in 2008, and the subsequent final rule in 2011 that broadened the definition of disability to include impairments to bodily functions (such as the immune system, special sense organs, normal cell growth, and digestive, genitourinary, neurological, bowel, respiratory, cardiovascular, endocrine, hemic, lymphatic, musculoskeletal, and reproductive functions, among others). Since the amendments passed, courts have more broadly interpreted “disability,” although they continue to assess each case individually. This relatively untested new version of disability could include protections for Kristin and many others with chronic conditions under Section 1557.

Until HHS or a court decides, those with health conditions will continue to rely on the slow, partial protections of Section 1302. Kristin deserves a better system. She deserves a system that prospectively bans discrimination on the basis of her race, color, national origin, sex, age, disability, and health, either by being excluded from insurance plans or by being priced out of them. Kristin deserves to be able to file suit when she is being discriminated against. Kristin deserves to be covered by Section 1557.

http://healthaffairs.org/blog/2015/09/21/the-section-1557-regulation-whats-missing-and-how-we-can-include-it/

***

Nondiscrimination in Health Programs and Activities

Federal Register, September 8, 2015

Summary

The Department of Health and Human Services (HHS or “the Department”) is issuing this proposed rule on Section 1557 of the Affordable Care Act (ACA) (Section 1557). Section 1557 prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs and activities. Section 1557(c) of the ACA authorizes the Secretary of the Department to promulgate regulations to implement the nondiscrimination requirements of Section 1557. In addition, the Secretary is authorized to prescribe regulations for the Department’s governance, conduct, and performance of its business, including, here, how HHS will apply the standards of Section 1557 to HHS-administered health programs and activities.

https://www.federalregister.gov/articles/2015/09/08/2015-22043/nondiscrimination-in-health-programs-and-activities

***

Comment:

By Don McCanne, MD

Insurers will always try to find a way to avoid paying for health care whenever they can. This article explains “adverse tiering” – an innovation by the insurers wherein needed services or products used by individuals with high-cost disorders are placed in a higher tier of coverage in which patient cost sharing is much higher. This adverse tiering is being used by insurers to discourage enrollment in plans by people with disorders such as HIV, hepatitis C, multiple sclerosis, rheumatoid arthritis, or leukemia.

Section 1557 of the Affordable Care Act (ACA) – the nondiscrimination section – states that an individual shall not “be excluded from participation in, be denied the benefits of, or be subjected to discrimination under, any health program or activity, any part of which is receiving Federal financial assistance, including credits, subsidies, or contracts of insurance, or under any program or activity that is administered by an Executive Agency or any entity established under this title (or amendments).”

After five years, HHS has finally released a proposed rule for Section 1557 nondiscrimination under ACA. As Douglas Jacobs explains in the Health Affairs Blog, the proposed rule does not seem to adequately address adverse tiering discrimination. Banning such discrimination can be technically challenging since price tiering is encouraged by some in the policy community as a means of discouraging patients from receiving expensive care that they do not really need (the rhetoric of advocates of consumer-directed health care). Another possibility that Douglas Jacobs suggests is that the proposed rule could be modified to enable lawsuits under the amended Americans with Disabilities Act (ADA).

After reviewing the 200 page proposed rule and considering the complexities of defining how adverse tiering discrimination could be banned while still leaving tiering in place, or considering the complexities of lawsuits under ADA, even in defining whether these expensive conditions are disabilities, it does seem clear that these approaches further increase the wasteful administrative excesses that already plague our heath care system.

In contrast, a single payer national health program would eliminate cost sharing thereby eliminating the insurers’ tool of adverse tiering, not to state the obvious of eliminating the insurers themselves. Life for patients and their health care professionals would be so much simpler.

School of Medicine holds rally, vigil in support of Medicare

By Amanda Kaufman
The Daily Free Press (Boston), Oct. 2, 2015

Joining 30 other universities around the nation, the Boston University School of Medicine hosted a Medicare-for-All National Day of Action rally Thursday to advocate for single-payer health care reform. BU was the only university in Massachusetts to participate.

Organizers and attendees of the rally used the hashtag #TenOne, representing Oct. 1, on social media to spread the word about the cause and connect with the other universities.

BUSM students, professors and policymakers gathered on BU’s Medical Campus to discuss the current inadequacies of the United States’ health coverage system and to raise support for Medicare reform.

The rally ended with a candlelight vigil to honor the lives lost due to the lack of affordable healthcare. The rally’s attendees held candles and colorful posters decorated with phrases such as “Help heal American healthcare!” and “Patients over Profits,” while also participating in a thirty-three second moment of silence to honor the thirty-three million Americans that remain uninsured.

Students for a National Health Program, the student branch of Physicians for a National Health Program, organized the rally.

Clara Zhu, one of the event’s chief organizers and a second-year BUSM student, said when organizing the event, the group wanted to focus on bringing together a variety of people to discuss the lack of healthcare in American and how it has affected patients.

“We have attending physicians, residents, lawmakers, people who specialize in policy and, of course, medical students, and the idea there is that when you have a problem that is so large, that’s so entrenched in our culture, it’s important to be able to have allies from different fields to be able to approach that problem,” she said.

Zhu said America’s hesitance toward single-payer health care in comparison to several other established nations around the world is astonishing.

“Every other major industrialized nation has government-supported healthcare and manages to insure its citizens,” she said. “The United States is the wealthiest nation in the world and somehow still a massive portion of our citizens are uninsured or underinsured.”

Jawad Husain, a third-year BUSM student, said the rally was partly inspired by last year’s White Coat Die-Ins movement, which highlighted police brutality in America.

Over 60 BUSM students participated in White Coat Die-Ins last December in support of the Black Lives Matter movement. The rally was mirrored at 75 other medical schools across the nation, he said.

“[Medicare-for-All] was inspired by what we saw as a big increase in medical student organizing after the Black Lives Matter movement,” Husain said. “We were really inspired by the mobilizing of social media and coordinating a day of action across multiple schools, so that’s how this event came to be.”

Janine Petito, a third-year BU medical student, said there’s a large amount of support among students to start working on real healthcare reform. She said as medical students, they realize they have a lot of privilege and access to a patient population that the rest of the world does not have.

“There’s enough stress that comes along with any illness, whether it’s a broken foot or terminal cancer, and the fact that you could be financially ruined by a diagnosis that’s completely out of your control is outrageous,” Petito said.

First-year BU medical student Alex Iwamoto said the current healthcare system is a mess that has to undergo a lot of change.

“It’s going to be really hard through a lot of incremental change to get to something like single-payer healthcare, I don’t know exactly what it’s going to take,” he said. “Our current system costs a lot of money yet is wildly inefficient.”

School of Medicine holds rally, vigil in support of Medicare