Summary: An important study in the United Kingdom finds that care contracting with for-profit companies sharply raises preventable mortality. Privatization with for-profit providers threatens health outcomes in the UK and, as we have argued before, in the US.

Outsourcing health-care services to the private sector and treatable mortality rates in England, 2013–20: an observational study of NHS privatisation, The Lancet Public Health July 1, 2022, by Benjamin Goodair and Aaron Reeves

Summary:

Background: The effects of outsourcing health services to for-profit providers are contested, with some arguing that introducing such providers will improve performance through additional competition while others worry that this will lead to cost cutting and poorer outcomes for patients. We aimed to examine this debate by empirically evaluating the impact of outsourced spending to private providers, following the 2012 Health and Social Care Act, on treatable mortality rates and the quality of health-care services in England.

Methods: For this observational study, we used a novel database composed of … procurement contracts between April 1, 2013, and Feb 29, 2020 (n=645 674…), across 173 clinical commissioning groups (CCGs; regional health boards) in England … identifying [providers] as National Health Service (NHS) organisations, for-profit companies, or charities. We supplemented these data with rates of local mortality from causes that should be treatable by medical intervention, indicating the quality of health-care services. …

Findings: We found that an annual increase of one percentage point of outsourcing to the private for-profit sector corresponded with an annual increase in treatable [preventable] mortality of 0·38% (95% CI 0·22–0·55; p=0·0016) or 0·29 (95% CI 0·09–0·49; p=0·0041) deaths per 100 000 population in the following year. This finding was robust to matching on background characteristics, adjusting for possible confounding factors, and measurement error in our dataset. Changes to for-profit outsourcing since 2014 were associated with an additional 557 (95% CI 153–961) treatable deaths across the 173 CCGs.

Interpretation: The privatisation of the NHS in England, through the outsourcing of services to for-profit companies, consistently increased in 2013–20. Private sector outsourcing corresponded with significantly increased rates of treatable mortality, potentially as a result of a decline in the quality of health-care services.

Comment:

By Don McCanne, M.D.

Recently the founders of Physicians for a National Health Program and colleagues (including me) published an article in The Nation indicating why single payer Medicare for All is not enough and community ownership of the delivery system should be involved as well – a system like the British National Health Service. See our HJM post about that here.

In the meantime, our British friends have been experimenting with the alleged benefits of for-profit competition in health care, much as is promoted by the privatizers in our country – here privatizing both the delivery system and the payment/insurance system. Although we had plenty of data to show them the adverse consequences, nevertheless they proceeded with their studies and showed that their outsourcing of services to the private, for-profit sector significantly increased the rates of treatable mortality. Their experiment with privatizing health care killed patients.

(On a personal note, please excuse my repetition of a theme I have covered before. Having recently been exposed to a series of grand mal seizures which left me in a comatose state, I was placed in “hospice at home.” But fortunately having eventually partially recovered again, I felt like I had to take this opportunity to pound home once more real reform instead of being contented with incrementalism that takes such good care of private equity in health care but leaves millions of patients in need poorly served or not served at all. I know I won’t be around to see the reform we need, but maybe some of you will have your passion drive turned up to the level that we can get the job done. I know I can’t quit, so don’t you either.)

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Summary: Independence Day is about celebrating freedom. Let’s contemplate the freedoms we can achieve with universal health insurance.

Comment:

By Jim Kahn, M.D., M.P.H.

On this day in 1776 we declared independence from Great Britain. We asserted, and soon realized, our desire to be free of overseas control and exploitation – political, religious, and financial. Thus was the US founded in freedom (if initially only for white men).

Yet freedoms often conflict with each other, and with our communal goals. The freedom to vote runs up against a claimed freedom to establish local election rules. The freedom to do business conflicts with a commitment to workers, consumers, and the environment. Our independence relies in critical and complex ways on our interdependence. Individual freedom must be balanced with collective welfare.

In health, the balance is askew.

Freedom to profit financially is taken as paramount. Insurers, pharmaceutical companies, and many providers profit outrageously by charging high prices for services that are rationed or cost pennies to produce.

To that profit altar we sacrifice all the other freedoms that should prevail:

• Freedom to seek quality health care without impediment.
• Freedom to choose providers.
• Freedom to select therapies.
• Freedom from medical debt.
• Freedom from administrative barriers and hassles.

These health care freedoms are due to us all, regardless of economic status, race, gender, and citizenship.

We all deserve the freedom to enjoy the “free lunch” that is single payer: cheaper and better.

Freedom means placing community welfare over individual financial gain.

That’s the country I’m rooting for today, and every day.

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Summary: Today’s post by a visiting blogger reflects on recent policy think tank reports on medical debt, and bemoans the lack of attention to a much-needed major financing makeover.

Comment:

By Ana Malinow, M.D.

It always goes like this: excellent reporting and analysis from the best health policy think tanks detailing how the US health care system is failing, building up to a crescendo that surpasses credulity, followed by a conclusion full of banal suggestions as to how we can address these failures. The storyline never deviates.

Take the Urban Institute’s Which County Characteristics Predict Medical Debt? (covered yesterday in HJM), which maps the geographic distribution and drivers of medical debt, a problem unknown in other high-income countries. To our dismay, we find that “the county’s prevalence of chronic conditions is the strongest predictor of a county’s medical debt in collections.” That means, these human beings and their families, who should be worried about their health, are instead worried about their bills.

And the policy insights to address this unimaginable suffering? Let’s see: first, because many of the counties with the highest rates of medical debt are from states which didn’t expand Medicaid, let’s expand Medicaid, the country’s racialized, second-class health care system for the poor. Forget that these people with chronic illnesses will have to prove their poverty month after month to meet criteria.

What else does the Urban Institute suggest? Consumer protections against surprise bills, even though the Kaiser Family Foundation just wrote that “surprise bills” represent just a fraction of the unexpected and large medical bills many Americans face. Oh, and yes, increase these poor people’s access to more credit, so they can become even more indebted.

What Urban Institute also finds, yet never elaborate upon, is that “counties with a higher share of the population ages 65 and older have lower rates of medical debts in collections.” That’s the age when people become eligible for Medicare – near universal coverage for the elderly. Not worth highlighting, apparently.

I can’t say with certainty what’s driving these very modest policy proposals rather than system-changing reform. I do know that Urban Institute funding is from mainstays of the current system. According to their 2020 Annual Report, that’s 35% federal government (including HHS and MedPAC), 34% foundations (including Merck, Walmart, Gates, Charles Koch Institute, and Walton Family), and 20% corporations (including JP Morgan Chase, Wells Fargo, Bank of America, Salesforce, AARP, Amazon, GM, Microsoft, QuickenLoans, Blue Shield Blue Cross Massachusetts, H&R Block, Lyft, National Associations of Realtors, etc).

And while we are on the subject of excellent reporting and analysis with lame conclusions, the Kaiser Family Foundation, in their recent publication on the burden of medical debt (covered in HJM) goes through excruciating detail describing who has medical debt: just about anyone in the US, but especially people with disabilities, those in worse health, those who live in poverty, Black Americans, people living in the South, and again, people living in Medicaid non-expansion states. At least the KFF has the integrity to write that “simply expanding coverage” will not solve the problem of medical debt in the US. But they refuse to connect the dots they so painstakingly displayed to major system change.

A national, single payer, universal, comprehensive, accessible, equitable health care system would abolish medical debt. Think about it. Why not just come out and say it?

Dr. Malinow is a pediatrician, former president of PNHP, and lead organizer for National Single Payer.

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Summary: Recently we reported on a national survey of medical debt. A new report uses credit bureau data to describe which local factors predict high levels of medical debt in collections. They are: being in the South, % of population with 4 or more chronic medical conditions, % low birth weight, % uninsured, % Black, low average income, and high medical spending.

Which County Characteristics Predict Medical Debt?, Urban Institute, June 15, 2022, by Fredric Blavin, et al.

Medical debt is a critical challenge to Americans’ financial stability and well-being. We use unique Urban Institute credit bureau data on more than 10 million consumers to investigate (1) where people are more likely to have medical debt in collections and (2) which county-level socioeconomic and health characteristics predict medical debt. We find that 79 out of the 100 counties with highest levels of medical debt in collections are in states that have not expanded Medicaid under the Affordable Care Act. These counties are mostly concentrated in Georgia, North Carolina, and Texas. We also find that a county’s prevalence of chronic conditions is the strongest predictor of medical debt in collections. In addition, counties with high shares of uninsured, low-income, or Black populations have higher rates of medical debt in collections. We offer a few insights on policies that can reduce medical debt, such as Medicaid expansion and consumer protections through the No Surprises Act.

Comment:

By Jim Kahn, M.D., M.P.H.

Black spots on the US map indicate that >30% of consumers have medical debt in collections. Not just medical debt, but in formal collections processes. Darker blue areas are at 20-30%.

Predictors include high rates of uninsurance, and related to that living in states with no ACA Medicaid expansion. Also the usual markers of vulnerability: % sick with multiple chronic conditions, % low birth weight, % low income, and % Black.

What is wrong with our country that we waste >$600 billion yearly on administrative complexity and profits for a fractured insurance system that torments the most vulnerable among us with financial problems related to getting medical care? We stand alone among wealthy countries in this cruelty.

Our health care financing system is a massive failure — inefficient, unkind, and deadly. No tweaks will fix its fundamental problems. How much clearer could that be?

We must find a way to transform today’s crises into a health system and country we can be proud of.

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Summary: Reflection seems the order of the day. US politics are in turmoil. Health insurance problems and the need for single payer are clearer than ever. How do we put it all together?

Talk World Radio: James G. Kahn on 300,000 U.S. COVID Deaths from Lack of Universal Healthcare (and other issues), 28 minutes

Comment:

By Jim Kahn, M.D., M.P.H.

Today we’re sharing an interview about our study on excess COVID deaths caused by high rates of uninsurance. We discussed a wide variety of issues in the framing of health insurance problems and reform.

Meantime, I’m contemplating next steps in the single payer movement, given recent momentous national political developments. More on that soon.

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Summary: Yesterday the Supreme Court reversed 50 years of abortion rights established by Roe v. Wade. This attack on reproductive rights and health is an integral part of a broader half-century undermining of our democratic system. The fights to save democracy and provide universal healthcare are linked.

Letters from an American, June 24, 2022, by Heather Cox Richardson

At yesterday’s hearing of the House Select Committee to Investigate the January 6th Attack on the U.S. Capitol, we heard overwhelming proof that former president Trump and his congressional supporters tried to overturn the will of the voters in the 2020 presidential election and steal control of our country to keep a minority in power.

Today, thanks to three justices nominated by Trump, the Supreme Court stripped a constitutional right from the American people, a right we have enjoyed for almost 50 years, a right that is considered a fundamental human right in most liberal democracies, and a right they indicated they would protect because it was settled law. Today’s Dobbs v. Jackson Women’s Health Organization decision overturned the 1973 Roe v. Wade decision that recognized a woman’s right to terminate a pregnancy. For the first time in our history, rather than conveying rights, the court has explicitly taken a constitutional right away from the American people.

These two extraordinary events are related. The current-day Republican Party has abandoned the idea of a democracy in which a majority of the people elect their government. Instead, its members have embraced minority rule.

The Dobbs decision marks the end of an era: the period in American history stretching from 1933 to 1981, the era in which the U.S. government worked to promote democracy. It tried to level the economic playing field between the rich and the poor by regulating business and working conditions. It provided a basic social safety net through programs like Social Security and Medicare …

Now the Republicans are engaged in the process of dismantling that government. …

[The Dobbs decision argued] that the right to determine abortion rights must be returned “to the people’s elected representatives” at the state level, even as states are restricting the right to vote. …

We are still waiting on another potentially explosive decision in West Virginia v. Environmental Protection Agency, in which the court will decide if Congress can delegate authority to government agencies as it has done since the 1930s. If the court says Congress can’t delegate authority, even if it waters that argument down, government regulation could become virtually impossible.

Comment:

By Jim Kahn, M.D., M.P.H.

Make no mistake about it, yesterday’s Supreme Court decision to reverse Roe v. Wade, clearly an attack on reproductive health and women’s rights, is also integral to a broader attack on democracy. It is latest development in a decades-long concerted effort to deconstruct the federal assertion and protection of rights that started in earnest with FDR 90 years ago, and to exploit our biased electoral system to empower a minority to implement that agenda. The latest twist, we are reminded in the January 6 Congressional hearings, is that the GOP is willing to use big lies and subversion of basic democratic processes to complete their slow coup. Heather Cox Richardson, as usual, sees all the connections. I encourage you to read her full post.

Single payer is profoundly pro-democratic, as I’ve repeatedly written in HJM. It is universal, equitable, economically leveling, and guided by representatives of the people not of corporate shareholders. Thus, the fight for universal healthcare and for real democracy have linked core values. I believe that mending our health care financing will help mend our fractured democracy. But are these two goals linked strategically? Does the fight for single payer bolster efforts to preserve democracy? Does preserving democracy tactically advance the single payer cause? My intuition says yes, but I don’t yet understand the integrated battle plan. I’ll revert on that.

I’ll close with a reminder that this is not just about governance and human rights, it’s also about life and death. Ample research demonstrates that restricting access to abortion raises maternal and even infant mortality. The new decision and subsequent state actions to restrict or ban abortion will cause many hundreds of added deaths per year. The evidence can be seen here, here, here, here, and here.

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Summary: CMS promised that the Medicare REACH ACO program, which supplants Direct Contracting Entities as a capitated replacement of fee-for-service Medicare, would prevent using diagnostic upcoding to drive up payment rates as seen with Medicare Advantage. However, scrutiny of recent guidance to contractors, combined with past CMS regulatory failures, suggest extreme skepticism.

CMS REACH ACO Financial FAQs, Dated April 2022; Downloaded June 2022

Q: What is the purpose of the Coding Intensity Factor (CIF) and the ACO-level symmetric 3% cap in risk adjustment?

• Coding Intensity Factor (CIF). The retrospective CIF will ensure that the change in normalized risk scores across all claims-aligned beneficiaries is zero between the baseline year (2019) and the PY. It will be applied uniformly across ACOs for a given risk adjustment model.
• Symmetric 3% cap. A symmetric 3% cap will be applied to ACO-specific risk score growth only for Standard and New Entrant ACOs in PY2021 and onwards, and beginning in PY2024 for High Needs Population ACOs, if significant risk score growth is observed. Risk score growth will be determined at the ACO-level and the symmetric 3% cap applied for each PY relative to an annual rolling risk score reference year. However, starting in PY2024, the application of the symmetric 3% risk score cap will be modified to: 1) adopt a static reference year population for the remainder of the model performance period (as a substitute for the rolling reference year population), and 2) cap the ACO’s risk score growth relative to the ACO’s independently calculated demographic risk score growth …

Comment:

By Jim Kahn, M.D., M.P.H.

What does this technical mumbo-jumbo mean? Well, CMS and MedPAC acknowledge that the Medicare Advantage program has been plagued by rampant diagnostic upcoding, as compared with traditional Medicare, and inadequate corrective action is leading to hundreds of billions in overpayments to private MA insurers.

So, for the REACH ACO program (rebranded DCEs) CMS promised to hold the diagnostic risk score to a reference year, presumably at the start of the program. No upcoding, they said.

Then come the details. The devil is always in the details.

The first bullet is tricky. What’s key to understand is that “normalized” means counting only the coding growth that exceeds traditional Medicare coding growth. So, it’s not zero coding growth, it’s zero compared with some reference growth rate. But how will that growth rate be calculated? When assessing Medicare Advantage over-coding, the reference comparison was clear – traditional Medicare. Yet REACH ACOs are displacing traditional Medicare. So is the reference the remaining un-REACHed corners of traditional Medicare? Or all of traditional Medicare, including the REACH parts, which leads to a self-referential paradox?

The second bullet says that each ACO will be permitted an annual growth of 3% in risk score, compared with the prior year. That’s huge. Is it 3% absolute, or 3% above “normalized” growth? Critically, the promised static “reference year” kicks in only in 2024, just two years before the program ends. And, if the program changes before 2026, it won’t even happen. Oops, the actual implementation drops the reference year promise. Just like that, poof, gone!

If you’re confused, you’re not alone. I certainly am. The language used obscures as much as it clarifies.

What we’ve seen with Medicare Advantage is that even with crystal clear rules, the insurers influence Congress and CMS to inadequately adjust for known MA over-coding. This failure shifts billions from the government and beneficiaries to insurance stockholders.

Two additional issues:

Note that there’s a separate “demographic” adjuster – another opportunity to increase payments and profits.

And, as we’ve noted before, with the tempting prospect of keeping 100% of the first 25% in savings, REACH ACOs will work hard to suppress utilization, via care denials, “lemon dropping”, and other techniques.

Gilfillin and Berwick recently re-iterated concerns that the corporate nature of REACH ACOs will exacerbate profiteering gaming. These worrisome risk adjustment details compound that fear.

I predict that if REACH continues, within 3-5 years we will see in technicolor how these complex and squishy rules provided the opportunity for ACO contractors to increase payment rates, decrease outlays, and generally fleece the government and Medicare beneficiaries of hundreds of billions of dollars. One could call it, I suppose, my “Exploitation Expectation”.

It’s imperative that REACH is stopped; inserting corporations into traditional Medicare is a travesty.

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Summary: Health savings accounts (HSAs) paired with deductibles are regressive: they yield financial gains mostly for healthy individuals with high income. They are justified as reducing health care costs, but these benefits are minimal. Now that large deductibles are widespread, any pretense of HSA cost-control is gone. When will we end this tax break for the rich?

Health Savings Accounts No Longer Promote Consumer Cost-Consciousness, Health Affairs, June 2022, by Sherry A. Glied, Dahlia K. Remler, and Mikaela Springsteen

Abstract:

Two decades ago Congress enabled Americans to open tax-favored health savings accounts (HSAs) in conjunction with qualifying high-deductible health plans (HDHPs). This HSA tax break is regressive: Higher-income Americans are more likely to have HSAs and fund them at higher levels. Proponents, however, have argued that this regressivity is offset by reductions in wasteful health care spending because consumers with HDHPs are more cost-conscious in their use of care. Using published sources and our own analysis of National Health Interview Survey data, we argue that HSAs no longer appreciably achieve this cost-consciousness aim because cost sharing has increased so much in non-HSA-qualified plans. Indeed, people who have HDHPs with HSAs are becoming less likely than others with private insurance to report financial barriers to care. In sum, promised gains in efficiency from HSAs have not borne out, so it is difficult to justify maintaining this regressive tax break.

Comment:

By Don McCanne, M.D.

After two decades, conservatives are still promoting health savings accounts, in spite of their pronounced regressivity. We have long needed policies that assist lower income individuals, yet health savings accounts and their associated high deductible health plans have failed to protect those with more modest incomes. Only a well-designed single payer Medicare for All system would. So why on earth does support for this unsuccessful policy persist when it works to the detriment of the poor but not the wealthy?

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