PNHP

2014 National Strategy Conference for Single Payer

2014 National Strategy Conference for Single Payer

By Don McCanne
August 25, 2014

This weekend numerous organizations dedicated to single payer reform assembled in Oakland, California for the 2014 National Strategy Conference. Participating organizations included Healthcare NOW!, Labor Campaign for Single-Payer Healthcare, One Payer States, National Nurses United, Physicians for a National Health Program, Progressive Democrats of America, and many others. So what was accomplished?

Above all, just gathering dedicated single payer supporters together in a single weekend meeting provided renewed energy and passion amongst the attendees, confirming that the single payer movement is not only still alive, it is thriving. We have a future.

Did we develop a national strategy that will culminate in enactment of single payer reform with the installation of a new government after the 2016 elections? Well, not exactly, but nobody expected that. What we did accomplish was the sharing of ideas on strategy, policy, politics, single payer education, state and federal legislation, and innumerable other components of a social movement that would lead to single payer.

In both the formal sessions and in informal conversations there was a very broad spectrum of ideas discussed, though not all of the ideas mesh well. And this is from a solid core of single payer activists. But all views were expressed with the intent of advancing health care justice.

Others attending will certainly have different take-home points, but mine was that we each should continue to do what we are doing while helping to open new avenues in advancing the cause. Especially helpful would be efforts to educate others, expand grassroots efforts, and work to form coalitions with other social justice organizations.

There was a consensus that we should not waste time and squander energy by becoming divided over process. We need to direct that energy to making progress towards our goal of a single payer national health program – an improved Medicare for all.

Expand Medicare to improve access and reduce costs

By Thomas Meisenhelder
San Bernardino County (Calif.) Sun, Aug. 22, 2014

On July 30, 1965, President Lyndon Johnson signed into law the nation’s most successful medical care program, Medicare. This year marks the 49th anniversary of our commitment to provide good, accessible health care to those over 65. This program has been hugely successful and now covers 98 percent of the country’s senior citizens. Medicare costs rise more slowly than other health care costs and seniors with Medicare are more satisfied with their health care than those with private insurance.

We all know from the experience of our own families that Medicare has been a savior for ourselves and our loved ones. It is a resource we count on to preserve our economic and physical health. We should provide this resource to everyone.

It is no secret that the United States is the only developed country that has a health care system totally in the hands of private corporations that see health as a commodity to be sold for a profit. While the Affordable Care Act does expand coverage to perhaps 20 million more people, it does not cover everyone and it does not address the power of corporate interests or the related issues of rising health care costs and quality of care. Indeed, it mandates that people buy insurance from the private insurance industry.

Extending Medicare to all would provide good, accessible health care to all of us and lower costs to both individuals and their employers. We would bring to an end our disgraceful two-tiered system where the rich and well-off can access the latest treatments and technologies but the rest of us, especially lower income groups, suffer from no health care at all or care only in overcrowded and under-resourced clinics and emergency rooms. In addition, it would allow everyone freedom of choice when it comes to picking physicians and other providers. And, it would mean that we keep our health care coverage even if we lose our job.

Most likely, “Medicare for all” would also improve the quality of health care in the United States, moving us up to European levels of health as well as improving our satisfaction with the medical care we receive.

Research shows that “Medicare for all” would save nearly $600 billion in health care costs. These figures suggest that these savings would fund the expansion of Medicare coverage, improved benefits, and even allow the elimination of premiums and co-payments (with money left over to, for instance, pay down the national debt).

Substantial savings would come from reducing the obscene $476 billion in administrative costs billed by the notoriously inefficient private insurance industry. Medicare has merely 3 percent in administrative costs compared to 20 percent in private insurance firms.

Another $116 billion in savings would come by way of the new “Medicare for all” system’s size and the power it would have to negotiate drug prices with the pharmaceutical industry. This bargaining power would surely enable a reduction in drug prices to the much lower levels experienced (through similar policies) in Europe.

Adequate funding could come from increased efficiencies in the health care sector and the replacement of employer contributions to private insurers with a (in most cases) lower payroll tax. Additional funding could come from a reformed, simpler, and more just income tax system and, if needed, a financial transactions tax on Wall Street.

Let’s celebrate the 49th anniversary of Medicare by calling on our representatives in Congress to support HR 676, the “Expanded and Improved Medicare for All Act,” which would provide Medicare coverage for all while also saving the economy $592 billion.

Thomas Meisenhelder is professor emeritus of sociology at Cal State San Bernardino.

http://www.sbsun.com/opinion/20140822/expand-medicare-to-improve-access-and-reduce-costs-guest-commentary

Beware when insurance is too good

By C.V. Allen
The Modesto (Calif.) Bee, Aug. 23, 2014

My column on the inefficiency in Medicare Advantage (Page D1, July 29) inspired several letters to the editor. Some were from people who are enjoying the benefits of the plan (which is not the issue), a few were in agreement with my column because they understand the inflationary effect of Medicare Advantage borne by the taxpayer, and others objected – often with the same phrases and wording, suggesting a common origin.

So I’ll try to explain this a different way. The following is part myth (the government doesn’t sell auto insurance) and part reality – an example of how an insurance program can be gamed for private benefit to the detriment of the public – which is very much the issue.

Those wishing details can pick up a copy of  “Medicare overpayment to private plans,” an article in the International Journal of Health Services from May 10, 2013, at the Maino Community Health Library at McHenry Village or you can find it online.

Pretend for a moment you are a government employee responsible for developing an automobile insurance plan for sale to the public. You know that most drivers rarely use insurance, but there is a minority – those convicted of DUIs, teenagers – whose bad driving records significantly raise insurance costs for all. But your plan includes everyone and will cost $75 a month to break even.

One day a man sidles up to you and says, “Have I got a deal for you!”

He says he’s from Los Angeles; he’s an ordinary looking man with impenetrable sunglasses, blue suede shoes and a salesman’s soothing voice.

“You pay me $70 per person and I’ll sell auto insurance to anybody who wants it – and save you $5 each!”

Because you weren’t born yesterday, you reply, “You’ll have to take all comers, even those with a bad driving history. How can you do it so cheap?”

He smiles and says, “I run a driving school and I teach people how to avoid accidents.”

Saving $5 per person is enticing, so you go to your boss, who says fine, and the deal is made. For a while things go well and he sells a lot of insurance. Then you begin to notice that the costs of those who have remained in your plan is rising, first to $80 a month then gradually to $85. You go to your “friend” and ask how he is doing.

“Just fine,” he says, “and my clients just love my policy.” No wonder. Not only do they get insurance at lower rates, they also get amenities – tickets to the Giants, free gym membership and picnics in the park.

Because you weren’t born yesterday, you call a detective friend, explain the situation and ask him to investigate.

A month later he reports: It seems that most of those with DUIs and bad driving records have somehow migrated back to your policies, and teenagers are largely missing from your “friend’s” private policies. Without those high-risk drivers, his costs are down to about $60 per person while he is receiving $70. He now drives a Maserati and recently bought a big house in L.A.

So you go back to your old pal, and he gets upset when you mention all this to him. “Leave things alone,” he says, “or you’ll be sorry.”

When word of this slips out and there are calls to cancel the wasteful private program, there is an uproar from its members and the strutting of politicians vowing to “stop the massive cuts” when no such cuts are planned – only a return to the basic plan so costs are kept low for everyone.

Concerned, you ask your boss, “Who pays the added cost of this plan?” He smiles a sad smile and says, “The taxpayers of course, but they’ll never understand – it’s the way things work. Were you just born yesterday? By the way, what’s the name of your pal’s plan?”

“Auto Insurance Advantage,” you say.

Does this clarify the situation? Or were you born yesterday?

C.V. Allen is a semi-retired physician and community columnist.

http://www.modbee.com/2014/08/23/3497850/cv-allen-beware-when-insurance.html

CMMI blows a billion dollars on a flawed study

Project Evaluation Activity in Support of Partnership for Patients: Task 2 Evaluation Progress Report

Center for Medicare and Medicaid Innovation (CMMI)Submitted 7/10/2014

The Partnership for Patients (PfP) campaign was launched in April 2011 with the ambitious goals of reducing preventable hospital-acquired conditions (HACs) by 40 percent and 30-day hospital readmissions by 20 percent. To reduce harm at this level of magnitude, the campaign implemented a strategy to align all health care stakeholders, including federal and other public and private health care payors, providers, and patients, to focus on this issue concurrently. By influencing everyone to move in the same direction at the same time, the program strove to overcome the inherently limited reach of any single initiative operating in a complex environment. The three major components of the campaign, conceptualized as “engines,” are the Centers for Medicare & Medicaid Innovation (CMMI) investment engine, the federal partner alignment engine, and the outside partner engine. The program is national in scope, due to its level of implementation. For example, over 70 percent of general acute care hospitals in the United States (U.S.), representing over 80 percent of admissions, worked with PfP-funded Hospital Engagement Networks (HENs) during 2012-2013.

Findings

The PfP campaign focuses on 11 areas of patient harm. To date, the evaluation has found clear evidence for decreased rates of harms in five of the eleven areas, meaning the decreases are statistically significant, and/or meet statistical process control criteria for a special cause decrease, and/or (in cases where only aggregated data are available) are large in magnitude. These areas include obstetrical early elective deliveries (OB-EED), readmissions, adverse drug events (ADE), ventilator-associated pneumonia (VAP), and central line-associated bloodstream infection (CLABSI). In the other six areas, to date, the evaluation has found mixed evidence, meaning some datasets show decreases, while others show no change, or even worsening, including venous thromboembolism (VTE), catheter-associated urinary tract infection (CAUTI), other OB adverse events (OB-Other), pressure ulcers, surgical site infections (SSI), and falls.

The cost estimates available to date suggest cumulative savings of between $3.1 to $4 billion as a result of the decreases in harms since the baseline of 2010. Additionally, AHRQ has estimated 15,5001 deaths averted since 2010, based on mortality rate estimates associated with targeted harms. Tables 1 and 2 synthesize the evidence available to date for improvement in the rate of adverse events in each of the 11 areas, and Table 3 provides cost reduction estimates from the two available sources of estimates to date. Since hospital payment policies and other U.S. Department of Health & Human Services (HHS) programs that played an important role as part of the PfP campaign were in place and making changes over time, it is not possible at this time for the evaluation to identify the portion of these harm reductions and savings attributable to the PfP campaign’s direct work with hospitals versus alignment of forces for harm reduction versus other harm reduction work that would have continued with or without PfP.

http://innovation.cms.gov/Files/reports/PFPEvalProgRpt.pdf

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About the CMS Innovation Center

The Innovation Center was established by section 1115A of the Social Security Act (as added by section 3021 of the Affordable Care Act). Congress created the Innovation Center for the purpose of testing “innovative payment and service delivery models to reduce program expenditures …while preserving or enhancing the quality of care” for those individuals who receive Medicare, Medicaid, or Children’s Health Insurance Program (CHIP) benefits.

http://innovation.cms.gov/about/index.html

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Did Hospital Engagement Networks Actually Improve Care?

By Peter Pronovost, M.D., Ph.D., and Ashish K. Jha, M.D., M.P.H.
The New England Journal of Medicine, August 21, 2014

Everyone with a role in health care wants to improve the quality and safety of our delivery system. Recently, the Centers for Medicare and Medicaid Services (CMS) released results of its Partnership for Patients Program (PPP) and celebrated large improvements in patient outcomes. But the PPP’s weak study design and methods, combined with a lack of transparency and rigor in evaluation, make it difficult to determine whether the program improved care. Such deficiencies result in a failure to learn from improvement efforts and stifle progress toward a safer, more effective health care system.

CMS launched the PPP in December 2011 as a collaborative comprising 26 “hospital engagement networks” (HENs) representing more than 3700 hospitals, in an effort to reduce the rates of 10 types of harms and readmissions. The HENs work to identify and disseminate effective quality-improvement and patient-safety initiatives by developing learning collaboratives for their member facilities, and they direct training programs to teach hospitals how to improve patient safety. In a February 2013 webcast, CMS announced that the rates of early elective deliveries had dropped 48% among 681 hospitals in 20 HENs and that the national rate of all-cause readmissions had decreased from 19% to 17.8%, though it is unclear which HENs were included for each measure and what time periods were the pre- and post-intervention periods.

These numbers appear impressive, but given the publicly available data and the approach CMS used, it’s nearly impossible to tell whether the PPP actually led to better care. Three problems with the agency’s evaluation and reporting of results raise concerns about the validity of its inferences: a weak design, a lack of valid metrics, and a lack of external peer review for its evaluation. Though the evaluation of many other CMS programs also lacks this basic level of rigor, given the large public investment in the PPP, estimated at $1 billion, and the strong public inferences about its impact, the lack of valid information about its effects is particularly troubling.

The design of a quality-improvement program influences our ability to make reasonable inferences about its benefits to patients. Although individual HENs may have used more rigorous methods, the overall PPP evaluation had three important weaknesses: it used a pre–post design with only single points in the pre and post periods, did not have concurrent controls, and did not specify the pre and post periods a priori. Such an approach is highly subject to bias.

There are alternatives available, including a randomized or even a cluster-randomized trial. If such trials were not feasible, CMS could have used other robust design approaches, such as an interrupted time-series study with concurrent controls. Rather than having a single pre time period and a single post time period, this design entails repeated measurements of the safety indicators before and after the intervention in both HEN and non-HEN hospitals. Such an approach would have provided more valid inferences about the effects of the program, with few additional costs.

Beyond using a poor design, CMS did not use standardized and validated performance measures across all participating hospitals — further hampering inferences about the program’s effects. To support engagement, CMS allowed each HEN to define its own performance measures, with little focus on data quality control.

CMS also required HENs and participating hospitals to submit a large number of process measures of unknown validity. It is essential to use validated measures — ideally those endorsed by the National Quality Forum — unless there is a compelling reason not to. In instances where validated measures are unavailable, instead of using poor quality metrics, CMS can have an agency such as the Agency for Healthcare Research and Quality (AHRQ) or the CDC develop measures rapidly.

Finally, CMS made — and presented publicly — inferences about its program’s benefits without having subjected its work to independent evaluation or peer review. Peer review, though imperfect, is a powerful quality control.

The PPP involved an investment of nearly $1 billion to improve care — three times the annual budget of the AHRQ, the lead federal funding agency for implementation science, which often lacks resources for promising projects. With such a sizable investment, CMS could have supported a better evaluation. It could have randomized HENs or hospitals to receive interventions earlier or later; used standardized, validated measures across the HENs; built in basic data quality controls; and independently collected qualitative information alongside quantitative data to learn not just whether the interventions worked but also how and why they did, thereby advancing our understanding of the mechanisms and context of improvement science. These changes would have allowed the country to learn so much more.

The lack of a careful evaluation is symptomatic of a broader problem: some members of the quality-improvement community eschew even modestly rigorous methods, believing that one can simply “know” if an intervention worked. Though maintaining hope and optimism among clinicians is important, when untested interventions are implemented widely, they often fail to improve care. The confidence we can have in an intervention’s efficacy is directly related to the rigor with which it is designed, implemented, and evaluated. Given the strong desire to improve care and the conflicts of interest we all face in evaluating our own work, subjecting all evaluations to external examination is critical.

The field of improvement science is still in its infancy. Given the magnitude of the quality and cost problems in health care and the amount of money invested in mitigating these problems, the public, providers, and policymakers need to have confidence that money used to improve care is being well spent. It’s true that improvement science requires mixed methods and is difficult, but all good science is difficult. Failing to attend closely to issues of design, methods, and metrics leaves us with little confidence in an intervention. For the PPP, which required thousands of hours of clinicians’ time and large sums of money, that lack of confidence is particularly unfortunate. More important, the failure to generate valid, reliable information hampers our ability to improve future interventions, because we are no closer to understanding how to improve care than we were before the PPP. And that is the biggest cost of all.

http://www.nejm.org/doi/full/10.1056/NEJMp1405800?query=TOC#t=article

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Comment:

By Don McCanne, MD

Another creation of the Affordable Care Act (ACA) is the Center for Medicare and Medicaid Innovation (CMMI) – an entity established to test innovations in payment and service delivery models designed to reduce costs and improve quality. How is it doing?

After spending almost a billion dollars on a study designed to reduce hospital-acquired conditions – a budget three times the total annual budget of AHRQ (Agency for Healthcare Research and Quality) – we have almost nothing to show for that effort and expense. As the CMMI report states, “Since hospital payment policies and other U.S. Department of Health & Human Services (HHS) programs that played an important role as part of the PfP campaign were in place and making changes over time, it is not possible at this time for the evaluation to identify the portion of these harm reductions and savings attributable to the PfP campaign’s direct work with hospitals versus alignment of forces for harm reduction versus other harm reduction work that would have continued with or without PfP.”

In their article on the flaws in this program, Peter Pronovost and Ashish Jha make an observation that typifies what has been wrong with the entire reform process centered on ACA. They state, “some members of the quality-improvement community eschew even modestly rigorous methods, believing that one can simply “know” if an intervention worked. Though maintaining hope and optimism among clinicians is important, when untested interventions are implemented widely, they often fail to improve care.”

Think of some of the prominent personalities involved in crafting and implementing ACA and how outspoken they were and continue to be on what they simply “know” will work – accountable care organizations, bundled payments, pay for performance, competing exchange plans bringing us higher quality at lower cost, placing the empowered consumer in charge through deductibles and other cost sensitivity, and improving payment policies through the Center for Medicare and Medicaid Innovation.

The tragedy is that much of this was to avoid adopting a program that every informed person knows really would work – an improved Medicare for all. It would have been far better to have directed that billion dollars towards implementing single payer.

Is Austin Frakt right that Medicare Advantage may be worth the extra cost?

Medicare Advantage Is More Expensive, but It May Be Worth It

By Austin Frakt
The New York Times, August 18, 2014

Medicare Advantage plans — private plans that serve as alternatives to the traditional, public program for those that qualify for it — underperform traditional Medicare in one respect: They cost 6 percent more.

But they outperform traditional Medicare in another way: They offer higher quality. That’s according to research summarized recently by the Harvard health economists Joseph Newhouse and Thomas McGuire, and it raises a difficult question: Is the extra quality worth the extra cost?

In contrast to studies in the 1990s, more recent work finds that Medicare Advantage is superior to traditional Medicare on a variety of quality measures. For example, according to a paper in Health Affairs by John Ayanian and colleagues, women enrolled in a Medicare Advantage H.M.O. are more likely to receive mammography screenings; those with diabetes are more likely to receive blood sugar testing and retinal exams; and those with diabetes or cardiovascular disease are more likely to receive cholesterol testing.

Contemplating these more recent findings on quality alongside the higher taxpayer cost of Medicare Advantage plans invites some cognitive dissonance. On the one hand, we shouldn’t pay more than we need to in order to provide the Medicare benefit; we should demand that taxpayer-financed benefits be provided as efficiently as possible. Medicare Advantage doesn’t look so good from this perspective.

On the other hand, we want Medicare beneficiaries — which we all hope to be someday, if we’re not already — to receive the highest quality of care. Here, as far as we know from research to date, Medicare Advantage shines, at least relative to traditional Medicare.

Is Medicare Advantage worth its extra cost? A decade ago when quality appeared poor, the answer was easy: No. Today one must think harder and weigh costs against program benefits, including its higher quality. The research base is still too thin to provide an objective answer. Mr. Newhouse and Mr. McGuire hedge but lean favorably toward Medicare Advantage, saying cuts in its “plan payments may be shortsighted.”

http://www.nytimes.com/2014/08/19/upshot/medicare-advantage-is-more-expensive-but-it-may-be-worth-it.html?rref=upshot&abt=0002&abg=1

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How Successful Is Medicare Advantage?

By Joseph P. Newhouse and Thomas G. McGuire
The Milbank Quarterly, June 3, 2014 (online)

Quality of Care in TM (traditional Medicare) and MA (Medicare Advantage)

The plans’ medical management methods could, in principle, improve the quality of their care relative to that of TM. Unfortunately, it is difficult to compare the quality of care in TM and MA because the data necessary to do so are sparse (John Ayanian et al). A few comparisons can be made, however, from the data reported by beneficiaries in the Consumer Assessment of Healthcare Providers and Systems (CAHPS) surveys, although the beneficiaries’ ability to assess the technical quality of their care clearly is limited.

http://onlinelibrary.wiley.com/doi/10.1111/1468-0009.12061/full

Joseph P. Newhouse is a member of Aetna’s Board of Directors:
http://www.aetna.com/about-us/corporate-governance/board-of-directors.html

Thomas McGuire coauthored the paper, “Making Medicare advantage a middle-class program”:
http://www.hcp.med.harvard.edu/publications/making-medicare-advantage-a-middle-class-program

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Medicare Beneficiaries More Likely To Receive Appropriate Ambulatory Services In HMOs Than In Traditional Medicare

By John Z. Ayanian, Bruce E. Landon, Alan M. Zaslavsky, Robert C. Saunders, L. Gregory Pawlson and Joseph P. Newhouse
Health Affairs, July 2013

Our results suggest that the positive effects of more-integrated delivery systems on the quality of ambulatory care in Medicare HMOs may outweigh the potential incentives to restrict care under capitated payments.

From the Conclusion

The Affordable Care Act authorized CMS to begin contracting with accountable care organizations that will share financial risk with CMS for the costs and quality of care received by the traditional Medicare beneficiaries they serve.23 Through the Medicare Pioneer Accountable Care Organizations and Shared Savings Programs, these organizations are eligible to receive bonus payments, initially related to reporting quality measures and subsequently to achieving higher quality of care.

These recent parallel expansions of financial incentives for achieving better quality of care in Medicare Advantage and traditional Medicare heighten the need for performance measures that can be compared between these two major components of the Medicare program. Such measures will enable policy makers, health care providers, and Medicare beneficiaries to assess whether the quality of care in Medicare Advantage health plans differs from that provided within accountable care organizations and from that provided outside these organizations in the traditional Medicare program.

http://content.healthaffairs.org/content/32/7/1228.full

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Pioneer Accountable Care Organizations disappoint

By Don McCanne
PNHP Blog, July 17, 2013

The Pioneer Accountable Care Organizations (ACOs) were already existing health care organizations that were selected as potentially exemplary models that could show the rest of the nation how well ACOs can work to achieve higher quality at lower costs. We now have a report from CMS of the initial “successes” of this model.

Considering the added administrative hassle, the savings were negligible, with only 13 of the 32 organizations saving enough to receive “shared savings” from CMS, and 2 actually lost money.

Even the supposed quality gains were unimpressive since they represented only 15 measurements which the organizations were told in advance would be used to determine whether or not they met quality standards. These teach-to-the-test gains can hardly represent the overall quality status of each organization.

https://pnhp.org/blog/2013/07/17/pioneer-accountable-care-organizations-disappoint/

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Comment:

By Don McCanne, M.D.

The private Medicare Advantage plans promised higher quality at lower cost. They clearly have failed on the promise of lower costs, but are they actually providing improved quality that is worth the extra cost?

Austin Frakt cites the Milbank Quarterly article by Joseph Newhouse and Thomas McGuire as providing the evidence for higher quality. In their article they state, “it is difficult to compare the quality of care in TM (traditional Medicare) and MA (Medicare Advantage) because the data necessary to do so are sparse.” They cite as their source a Health Affairs article by John Ayanian et al (Joseph Newhouse being a coauthor) which states, “These recent parallel expansions of financial incentives for achieving better quality of care in Medicare Advantage and traditional Medicare heighten the need for performance measures that can be compared between these two major components of the Medicare program.” Yes, performance measures that we do not have.

The ideological preferences of Newhouse and McGuire can be gleaned from the links above – a bias which shines through in their Milbank Quarterly article.

The point is that, other than for a few primitive teach-to-the-test measurements, measurement of quality is still in the dark ages. The Medicare Advantage plans would be expected to do better on these few measurements since they use them for marketing purposes (Medicare star ratings) and to gain bonuses. Even Austin Frakt writes, “The research base is still too thin to provide an objective answer.”

The case for higher quality in Medicare Advantage plans has not been made.

An excellent article that concurs with this view: “No, We Still Don’t Have Proof That Private Medicare Plans Are Better,” by Thomas Huelskoetter:

http://thinkprogress.org/health/2014/08/20/3473823/medicare-advantage-costs/

Avalere study of proposed copper plans

Study Shows “Copper Plan” Would Lower Premiums by 18 Percent

Bill by Sen. Mark Begich (D-AK) would expand employer health coverage
Council for Affordable Health Coverage, August 18, 2014

The Council for Affordable Health Coverage today released an estimate by Avalere Health LLC showing that legislation to permit a new, less expensive tier of insurance coverage under the Affordable Care Act would lead to an additional 350,000 Americans keeping their employer sponsored health insurance in 2016. Because fewer people would lose their coverage, taxpayers would spend $5.8 billion less on exchange subsidies, while employers would pay about $5.5 billion less in penalties under the employer mandate.

http://cahc.net/press-release-study-shows-copper-plan-would-lower-premiums-by-18-percent/

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Estimated Impact on the Federal Deficit and Insurance Premiums from Creating a New Health Plan Tier with an Actuarial Value Level of 50 Percent

Avalere, June 6, 2014

Summary

The Council for Affordable Health Coverage requested Avalere Health to estimate the impact on the federal deficit of a legislative proposal that would allow a new type of plan tier for consumers in the new health insurance marketplace as well as small employers. Plans on this new tier would have an actuarial value (AV) of 50 percent. As originally passed in the Affordable Care Cat (ACA), commercial health insurance plans in the individual and small group markets must cover at least 60 percent of the estimated health costs of enrollees starting in 2014.

We estimate that creating a new tier with an AV of 50 percent would reduce the federal deficit by $0.3 billion between FY 2015 and FY 2024. This estimate assumes that the new tier would be available to consumers starting in plan year 2016. The reduction is due to a net $5.8 billion decrease in subsidies paid by the federal government for individuals in the new health insurance marketplace, primarily due to an increase in the estimated number of employers who will offer affordable coverage to employees. Counteracting this reduction in federal spending is an estimated $5.5 billion decrease in revenues collected by the federal government, again primarily due to fewer employers paying the employer mandate penalty.

We also estimate that the premium for the new plan with a 50 percent AV would be nearly 18 percent lower than the premium for an average bronze tier plan in 2016. The lower premium would result in a slight increase in estimated enrollment in the new marketplace.

http://cahc.net/wp-content/uploads/2014/08/20140605-CAHC-New-50-AV-Tier-Score.pdf

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‘Copper plans’ could cut subsidies, lower deficit, but would consumers bite?

By Paul Demko
Modern Healthcare, August 19, 2014

Allowing cheaper health plans designed to cover just half of medical costs to be sold on the exchanges would result in 350,000 additional individuals enrolling in coverage in the next decade, according to an analysis by Avalere Health.

The lower actuarial threshold also would convince some employers to maintain coverage, according to the Avalere analysis. The Society of Actuaries has predicted that 3% of employers will stop providing coverage under the ACA. But if the copper plan option existed, Avalere estimates that 4% of that group would continue offering coverage to workers. That increase represents just 0.1% of the current employer-sponsored market.

America’s Health Insurance Plans, the primary industry group, supports allowing what are often referred to as “copper plans” to be sold on the exchanges. The organization has argued that it would entice more people—particularly younger, healthier individuals – into the marketplaces.

http://www.modernhealthcare.com/article/20140819/BLOG/308199995

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Comment:

By Don McCanne, MD

One of the major problems with the Affordable Care Act is that it has established underinsurance as a new standard. It was bad enough when the decision was made to allow insurers to offer products that covered an average of only 60 percent of estimated health care costs, but now there is a serious proposal to reduce that to 50 percent. What does this do?

From the insured’s perspective, it would fulfill the requirement to purchase insurance, while keeping premiums as low as possible, with a tradeoff that you must accept the risk of paying on average the other half of health care costs that the insurer does not pay for (plus all costs for services not covered and for the balance of charges for out-of-network services). For the majority, such costs would create a financial hardship should significant medical problems develop – the reason this is labeled underinsurance.

From the insurers’ perspective, while discounting the premium by only 18 percent below that of a 60 percent actuarial value bronze plan, they can attract healthier individuals who are more likely to be willing to gamble that they may not need much health care. This would be a great deal for the insurers.

A 50 percent actuarial value copper plan would be appealing to libertarian conservatives for a few reasons. It uses a consumer-directed approach to health care purchasing by exposing the patient to significant out-of-pocket costs, requiring the patient to became an informed price shopper (even though the out-of-pocket expenses may not be affordable). It also allows consumers to exercise choice over market originated insurance products, rather than defaulting to a more comprehensive single payer program administered by the government that would actually work. Furthermore, the Avalere study shows that adding a copper level choice would reduce the federal deficit by about 30 million dollars a year. Little does it matter that 30 million dollars would not even qualify as a footnote in our federal budget, it is fulfilling an ideological goal of reducing federal spending that is compelling to conservatives.

What about fulfilling the goal of advocates of health care justice? Obviously this proposal was not written for them. Creating a plan that exposes the sick to financial hardship is the opposite of what insurance should be doing.

Rather than talking about insurance, we should be talking about prepaid health care – removing the financial barriers to the health care that you need, when you need it. This is precisely what a single payer national health program would do.

I can’t wait to see their proposal for a health plan with a 10 percent actuarial value. You doubt it? If AHIP can get clearance for private insurers to produce such a plan and have it count as fulfilling the insurance requirement thereby avoiding the penalties for being uninsured, I guarantee you that they will find a market for it. It would be ideal for insurers since it would eliminate 90 percent of their risk while allowing them to continue to sell us a profusion of wasteful administrative services. And our bureaucrats? “If that’s a product that the people want…”

Dr. Steven Nissen: ‘I want to replace the insurance industry’

The following is an unofficial transcript of parts of an interview that Dr. Steven Nissen, chairman of cardiovascular medicine at the Cleveland Clinic, gave to Ed “Flash” Ferenc, host of the labor-oriented, Cleveland-based America’s Work Force Radio, on Aug. 15, 2014. In addition to the points he makes below, Dr. Nissen also spoke about pharmaceutical drug safety and other issues. The audio of the entire program is available at awfradio.com/todays-show-8-15-14/. The segments of the show that feature Dr. Nissen are noted at the end of the transcript.

HOST ED ‘FLASH’ FERENC: We’re going to start things off with Steve Nissen. Steve is the chairman of cardiovascular medicine at the Cleveland Clinic. He served nine years as vice-chairman, five years as medical director, of the cardiovascular center that directs multi-center clinical trials. He’s got some national leadership positions, too, which include a term as president of the American College of Cardiology. He also served the Food and Drug Administration as a member of the cardio-renal advisories panel. He spent about five years there and continued as an adviser to several FDA committees. He’s known for public policy discussions regarding drug safety; in fact he testified in the Senate and the House of Representatives on the need for FDA reform. Most recently, he’s been outspoken about the need for a single-payer health system, health insurance, or better known as “Medicare for All.” [Here the host talks at some length about the key features of a single-payer system.] …

Let’s talk about the [health] system as far as paying for it. What are your thoughts on the Affordable Care Act that is underway in America right now?

STEVEN NISSEN: Well, first of all, we had to do something. Having the richest country in human history having 50 million people without health coverage was a shame on our society, and is just not acceptable. And a lot of those 50 million people are working people. They’re people who work in jobs that are often low-paying, maybe the person who hands you your dry cleaning when you go up to the window, or in a fast food restaurant, and we have to be a civil society. We have to provide health care for everybody. Nearly every other developed country does that. They have universal health care systems, and we didn’t. The Affordable Care Act is a compromise that was forged through very difficult political discussions. And it’s far from perfect. I would have gone much further than it went, toward a simpler, universal health care system, but it did move us in the direction of making certain that everybody – or at least most people – have access to health care. To the extent that it did that, I support it, even though I recognize there are flaws in the way the law was designed. The flaws come out of political compromise. It wasn’t written by, necessarily, by a single party. It had to get some bipartisan support to get anywhere.

HOST: Yes. The single-payer system, it’s been, I guess, proven to work in a number of countries – you even referenced that a few minutes ago.

NISSEN: It does. I mean the Canadian system is excellent. They spend about half of what we spend, and a lot of what goes on in America is making us uncompetitive as a country is that we spend so much on health care and we aren’t any healthier than other people. A single-payer system is pretty simple. I mean if you want to think about a single-payer system, there’s one in place in the United States for people over 65. It’s called Medicare. Let me give you a fact about Medicare. The overhead for Medicare is about 3 percent. What that means is that 97 percent of what Medicare spends, it actually spends on for health care for people. The overhead for the private insurance industry is 29 percent, which means that almost one dollar out of every three is going for profit, for who knows what – I mean, trying to figure out who’s going to be covered and who’s not. Medicare is much more efficient, and so you can automatically reduce tens of billions of dollars in expenses just by making certain that you have a system like Medicare. There was a proposal during the health care reform debate to simply allow people to “buy-in” to Medicare, that is, use their own dollars to buy Medicare coverage beginning at age 55. I strongly supported that idea, but I supported it only because it was a bridge toward a true single-payer system. And what I hope would happen is that we’d get people to buy into Medicare at 55, then come back in a few years and say 50, and then we’d say 45, and the next thing we know, everybody could buy into Medicare and they would have had an efficient, high-quality system that worked. We don’t have that. Now what we have is the Affordable Care Act which really is trying to reform the insurance industry, not replace the insurance industry. I want to replace the insurance industry.

HOST: So they’d be out of it altogether.

NISSEN: Get them out of it. Their motives are profit, their motive is not making people healthier, their motive is making money. And the other part about the system that’s really challenging is that physicians, still many physicians, work on what’s called a fee-for-service basis, which means that the more they do to you, the more money they get paid. We work on a different model at the Cleveland Clinic. We’re all salaried. I get exactly the same salary every month, whether I order a cardiac catheterization or some other fancy test for you or not. There’s no incentive. There’s really no incentive to do things that aren’t really needed. Unfortunately, we are in a system where there is an incentive, and it is a perverse incentive. It’s one that says, the more stents you put in, the more money you make. And that is a problem, because it misaligns the needs of the patient and the interests of the patient, and the interests of the physician. In a single-payer system that works, we’d all be on salary. We would be [concerned about] quality care, but not on a fee-for-service basis.

HOST: Aren’t you restricted now by the insurance companies? Don’t they say, “Well, you can’t do that because it’s not covered”?

NISSEN: Well, they have all kinds of rules, but the rules are about profits. The rules aren’t about health care. They put restrictions on because they have to receive X amount of dollars from people to cover them, and the less care they can provide, the more money they make. That’s a very different situation from a situation where your physician is saying to you, “This is what I need to do to keep you healthy.” I just don’t want those decisions that are made by physicians to be excessively influenced by profit, by money. I want them to be influenced by what people really need in order to stay healthy.

HOST: Doctor, how many people at the Clinic have the same view as you on this?

NISSEN: I think probably a minority. I think medicine in general has been on the conservative side politically. My views are much more progressive. I’ve always felt very strongly about these kinds of matters, going back 30 or 40 years, to when I was a college student. But I’m influencing people and there are increasing numbers of physicians in America that are beginning to say, “The system is broken. We need to fix the system. Here are some things we can do to fix the system,” and the first place to look is how we pay physicians. Honestly, I think if we could get physicians on a salary basis, that would go a long way, and if we could then get to a point where we didn’t have insurance companies figuring out how to squeeze every dime out of the system, but rather a system that says, “How we can take better care of patients?” then that would be a single-payer system where there would be a government insurance plan, everybody would get it. You know what’s amazing about Canada? If you were to go to Canada, and you were to be in a terrible car wreck, as an American, and go to a hospital there, you’d never receive a bill. You could be in the hospital there for weeks and basically it’s just assumed by the Canadian society that if something happens to you, and you get sick, you should be taken care of. There’s no system there for billing people. You just go in and you get taken care of.

HOST: Isn’t that amazing?

NISSEN: And not all these insurance forms and all this kind of pre-qualification, and basically it’s patient-oriented, it’s oriented toward the public need. And I believe that’s the right thing to do.

HOST: You know it’s a real shame that in some many states, so many governors, especially in conservative states, have opted-out of Medicaid.

NISSEN: That’s just terrible. I mean what they’re saying to the poorest people in the society is that “We don’t care about you. We’d rather make a political point than support your health.” It’s unconscionable, it’s unacceptable, and the public shouldn’t put up with it.

HOST: You know there’s an organization – you’re not part of Physicians for a National Health Program, are you?

NISSEN: I’m not.

HOST: You might want to check them out. We’ve had some of their members on this show. Just go to pnhp.org, or just google single-payer health care and it will take you right there. They report that more than 7,000 people died because of the governors in those states opting out of Medicaid. People just didn’t get their health care.

NISSEN: What a tragedy. I know.

HOST: That’s a story that should be on the front page.

NISSEN: I know. And the other thing is, what’s the mission of medicine? What’s the oath that we take when we become physicians? It’s to heal the sick. And I don’t care what the politicians think, what I care about is the person in that exam room with me is my patient and deserves whatever I can give them. And I don’t want the payment system to get in the way of people getting good health care, because it’s not a privilege, it’s a right. And in most modern, developed societies, it’s understood to be a right, not a privilege of wealth. It’s part of being a human being and living in a country that fortunately has the resources to do this. We have the resources to get everybody good health care. We just have to have the political will to make it happen.

…

HOST: What’s your mission here, are you going to become more active in order to push this?

NISSEN: Well, I spend a significant period of time talking to people on Capitol Hill and you noted earlier I’ve testified on these matters in Congress and I will stay engaged in the political process, as much as I find it difficult in many ways. It’s not a lot of fun. And I continue to talk to my fellow physicians about why I think we need to be advocates for change. And we’ll see. I’m hopeful that over a period of many years we will gain more support. If we can get more physicians behind this concept we will gain momentum. There are powerful economic forces aligned against what we want to do. I mean, talk to the Koch brothers. They have a different mission, and their mission is to figure out how to pollute the environment and get away with it. And I want to fight back and I’m doing it because I really care about the patients and I think that’s part of the role of a physician, to be an advocate for patients. We will continue to be advocates and there are a number of us in Cleveland, there’s an organization of physicians in Cleveland, that gets together periodically and talks about these things and we’re going to continue to do that.

Time markers for key audio segments of show, the full hour of which can be found here: http://awfradio.com/todays-show-8-15-14/

Ed “Flash” Ferenc’s introduction of Nissen and Ferenc’s explanation of single-payer national health insurance can be heard from the 1 minute mark to 4:42.

Dr. Nissen’s comments on drug safety, the FDA, and Big Pharma take place from 13:40 to 20:30.

Dr. Nissen’s comments on the hazards of using the Internet to get medical advice run from 20:30 to 22:50.

Dr. Nissen’s comments on single payer run from 24:30 to 38:00.

Smaller primary care practices have lower rates of preventable admissions

Small Primary Care Physician Practices Have Low Rates Of Preventable Hospital Admissions

By Lawrence P. Casalino, Michael F. Pesko, Andrew M. Ryan, Jayme L. Mendelsohn, Kennon R. Copeland, Patricia Pamela Ramsay, Xuming Sun, Diane R. Rittenhouse and Stephen M. Shortell
Health Affairs, August 13, 2014 (online)

The Affordable Care Act and initiatives by private health insurance companies are driving major changes in the ownership of physician practices, the incentives practices face to improve the care they provide, and the processes practices use to improve care. Many practices are consolidating into larger medical groups. Many others are shifting from physician ownership to hospital ownership. Practices are increasingly subjected to pay-for-performance and public reporting programs and are being encouraged to implement processes used in patient-centered medical homes.

Ambulatory care–sensitive admissions are defined by the Agency for Healthcare Research and Quality (AHRQ) as admissions for conditions such as congestive heart failure for which good primary care may prevent admission.

In our large national study of small and medium-size primary care–based practices, practices with 1–2 physicians had ambulatory care–sensitive admission rates that were 33 percent lower than those of the largest small practices (having 10–19 physicians). Practices with 3–9 physicians also had rates that were lower than the rates for the largest small practices, although slightly higher than the rates for practices with 1–2 physicians. These findings were unexpected, since small practices presumably have fewer resources to hire staff to help them implement systematic processes to improve the care they provide. Larger practices did have higher patient-centered medical home scores than the practices with 1–2 physicians (though not higher than those with 3–9 physicians) and so appear to use more such processes, but these higher scores were not associated with lower ambulatory care–sensitive admission rates in multivariate analyses.

It is possible that small practices have characteristics that are not easily measured but result in important outcomes, such as fewer ambulatory care–sensitive admissions. For example, there is evidence that patients in smaller practices are better able to get appointments when they want them and better able to reach their physician via telephone, compared to larger practices. It is also possible that physicians, patients, and staff know each other better in small practices, and that these closer connections result in fewer avoidable admissions.

We cannot fully exclude the possibility that the largest practices, which had a somewhat higher percentage of specialists, had patients who were sicker and, therefore, more likely to have an ambulatory care–sensitive admission. However, we controlled for the percentage of specialists in practices and for patients’ demographic characteristics and comorbidities, and we found that the smallest practices cared for a significantly higher percentage of dual-eligible patients and for patients with more comorbidities.

Physician-owned practices had lower ambulatory care–sensitive admission rates than hospital-owned practices in both bivariate and multivariate analyses—approximately 13 percent lower in multivariate analysis.

Hospital ownership would be expected to result in a lower ambulatory care–sensitive admission rate if hospitals provided additional resources to practices to hire staff and implement systematic processes to improve care. In fact, consistent with prior studies, we found that hospital-owned practices used more patient-centered medical home processes than physician-owned practices. But these practices nevertheless had higher ambulatory care–sensitive admission rates. Hospital acquisition of a practice might disrupt longstanding referral relationships between the practice’s physicians and specialists outside the practice and might lead to other changes that result in worse performance by the practice and higher ambulatory care–sensitive admission rates.

We did not find an association between the ambulatory care–sensitive admission rate and the use of patient-centered medical home processes or between that rate and pay-for-performance or public reporting incentives. Prior research has resulted in inconsistent findings regarding the relationship between patient-centered medical homes and physician practice performance and between incentives and physician practice performance.

Physicians in small practices have no negotiating leverage with health insurers, so insurers typically pay them much lower rates for their services than they pay to physicians who practice in larger groups or are employed by hospitals. This policy might be penny wise and pound foolish if it drives small practices out of existence and if further research confirms that small practices have lower ambulatory care–sensitive admission rates, and possibly lower overall costs for patients’ care, than larger groups.

Small practices have many obvious disadvantages. It would be a mistake to romanticize them. But it might be an even greater mistake to ignore them, and the lessons that might be learned from them, as larger and larger provider organizations clash to gain advantageous positions in the new world of payment and delivery system changes catalyzed by health care reform.

http://content.healthaffairs.org/content/early/2014/08/08/hlthaff.2014.0434.abstract

****

Comment:

By Don McCanne, MD

It is believed that consolidation of the health care delivery system through the formation of larger groups of physicians and through hospital ownership of physician practices is anti-competitive and drives up health care spending, especially through non-competitive pricing. Nevertheless this consolidation is being encouraged under the assumption that closer integration of the health care delivery system will improve processes and outcomes, one rapidly expanding model being accountable care organizations. This important study casts doubt on this concept.

One important measure of the quality of care being provided is ambulatory care-sensitive admissions – admissions that can be prevented through good primary care. This study shows that small primary care practices had lower preventable admission rates than did larger practices. Further, although larger practices did have higher patient-centered medical home scores, the scores were not associated with lower ambulatory care–sensitive admission rates. Also, hospital-owned practices used more patient-centered medical home processes than physician-owned practices, yet these hospital-owned practices had higher ambulatory care–sensitive admission rates. Neither pay-for-performance nor public reporting incentives improved the rate of ambulatory care-sensitive admissions.

The policy and political communities are pushing innovations such as more closely integrated groups through consolidation and accountable care organizations, pay-for-performance, and patient-centered medical homes, when there is sparse evidence that these measures will improve quality or reduce costs. On the other hand, studies such as this demonstrate that traditional Marcus Welby, MD-type primary care practices serve us very well (as long as they do see more than one patient a week).

Patients have better access through a long standing relationship with a health care professional they know and trust and who knows and respects them, while receiving their care at a lower cost. Although this traditional model is now being threatened, a single payer system would revitalize it as long as it serves patients well.

‘Health care is a human right’: Medical students, doctors plan Boston rally for single-payer system ahead of gubernatorial forum

By Brian Steele
Masslive.com, August 19, 2014

Massachusetts lawmakers passed a universal health care program in 1988, but its implementation was repeatedly delayed and it was finally repealed when political power in the Statehouse swung away from Democrats and Republican Gov. William Weld was elected.

Decades have passed, but on Wednesday, Aug. 20, members of a group called Physicians for a National Health Program plan to rally before a gubernatorial health care forum at The Dimock Center in Roxbury, calling on all the candidates to agree to push for a new single-payer system if they’re elected.

The system would eliminate private insurance and replace it with a government agency that pays all medical bills with money collected under a progressive tax model. A program called “Medicare for All” was proposed in Congress in 2003 and periodically reintroduced, but never passed.

Jawad M. Husain is a second-year medical student at Boston University. He co-founded the student chapter of the non-profit physicians’ group, which is barred by law from endorsing candidates.

Husain said a single-payer system is about satisfying “a moral obligation to prevent suffering.”

“Forty-five-thousand people a year die because they don’t have health insurance in the U.S. That’s unacceptable to me,” he said. Even the Affordable Care Act, beloved by many liberals despite its well-publicized flaws, is projected to leave 31 million Americans without insurance by 2024.

“We need a pretty drastic improvement in our health care system,” he said. “I see health care as similar to education. … We, as a decent society, have an obligation to provide that to our citizens.”

An economist at the University of Massachusetts at Amherst argued last year that the money Americans spend on health care would almost instantly plummet under the single-payer model.

“The U.S. could save an estimated $592 billion annually by slashing the administrative waste associated with the private insurance industry ($476 billion) and reducing pharmaceutical prices to European levels ($116 billion),” wrote Gerald Friedman. “In 2014, the savings would be enough to cover all 44 million uninsured and upgrade benefits for everyone else.”

Friedman acknowledged that it would be expensive to pay unemployment insurance and retraining costs for every insurance agency employee in the country, and estimated the total cost of implementing the system at $391 billion.

Employers would no longer make contributions to employee health care, medical bills would become tax deductible and tax credits would be available to small businesses.

Advocates point to Canada’s health care system as a good example of the single-payer system in action. But in 2013, the average Canadian had to wait four-and-a-half months to be seen by a specialist for a medically necessary appointment, even after referral by a general practitioner.

That’s even longer than in 2012, according to the Fraser Institute, an independent Canadian think tank.

“Waiting has come to be a defining characteristic of the Canadian healthcare experience,” according to another Fraser Institute report. “Waiting for health care also has broader economic consequences. Increased absenteeism, reduced productivity, and reduced ability to work caused by untreated medical conditions and waiting can reduce overall economic activity.”

Longer waits also increase the risk that a medical problem will get worse.

In 2013, wait times in Massachusetts increased year-over-year for patients trying to get a first appointment with a new doctor, according to the Massachusetts Medical Society.

“We already have rationing. We already have wait times,” said Husain, who blames private insurance companies for choosing which patients are treated for which ailments, and how much doctors will receive in exchange. “Twelve cents of every dollar goes toward not providing care.”

He added that the only reason we know about Canada’s long lines is that the system is accountable to the taxpayers and such information is made publicly available. Under an American system, it would be the same deal, whereas insurance companies are accountable only to investors.

Still, even a single-payer system would require the administrators to make choices about who gets what. The model proposed by PNHP would cover only medically necessary procedures and medication, while supplemental insurance could be available for elective procedures, or the patient could pay out of pocket.

Private doctors and hospitals would remain private.

http://www.masslive.com/politics/index.ssf/2014/08/health_care_is_a_human_right_m.html#incart_river

Britain Has No Problem Paying for Expensive Hepatitis C Drugs

By John Tozzi
Bloomberg Businessweek, Aug. 18, 2014

Sovaldi, a highly effective treatment for the liver disease hepatitis C, has faced backlash in the U.S. over its price tag: $84,000 for a three-month course of treatment, or about $1,000 a pill. The private insurance industry has pushed back hard on the price. State Medicaid directors have said they are concerned about the cost, and paying for the drug is also problematic for prison systems, which must provide health for a lot of inmates who acquired hepatitis C by sharing needles.

Meanwhile, in the U.K., regulators just approved the use of Sovaldi as part of treatment for hepatitis C. The country’s National Health Service will pay about $700 a pill, roughly what some Medicaid programs will pay in the U.S.

The U.K.’s decision to recommend Sovaldi was far from a sure thing. But once the National Institute for Health and Care Excellence was convinced that Sovaldi is cost-effective, the decision to pay for it is simple, because one entity pays for all the medical care in the U.K. If treating a patient with costly drugs now prevents a more expensive liver transplant in 15 years, that savings accrues to the National Health Service—and ultimately to British taxpayers.

That’s not the case in the U.S., where health care is paid for by a mix of employers, private insurers, and government programs such as Medicaid and Medicare. Hepatitis C can take 20 to 30 years to cause liver scarring that might require a transplant. An insurer paying for Sovaldi now is probably preventing an expensive treatment that would have ultimately been paid for by another part of the health-care system—most likely Medicare, the federal insurance program for Americans 65 and older. Insurers don’t have much incentive to do that, even if it would save the U.S. health system money in the long run.

It’s still fair to question how drugmaker Gilead Sciences (GILD) came up with the price for Sovaldi, and why it will sell an entire course of treatment in Egypt for less than the price of one pill in the U.S. And treatment of Sovaldi isn’t the final verdict on whether a single-payer health-care system is better on the merits than the patchwork of private and public insurance programs the U.S. has. But Americans sometimes accuse Britain’s single-payer system of rationing of health care. In the case of a cure for hepatitis C, it seems the single-payer model is doing the opposite.

http://www.businessweek.com/articles/2014-08-18/sovaldi-why-the-u-dot-k-dot-will-pay-for-the-84-000-hepatitis-c-drug

Unions Can Lead the Struggle for Single-Payer Health Care

By Kay Tillow
Firedoglake, Aug. 18, 2014

Despite passage of the 2010 health care reform bill, employers continue to push for cuts in benefits and to shift costs to workers in higher monthly payments, co-pays, and deductibles.

Wage increases are always trumped by this costly health care monster. Some employers, in anticipation of the $2,000 annual fine for not offering health insurance, are threatening to drop coverage and instead pay the cheaper fine.

Many companies are dropping benefits for spouses, retirees, and part-timers. Current law does not stop them. Multiemployer plans are disadvantaged by the preferable treatment available to the plans of non-union employers. The 2018 excise tax will cap the ability to bargain better health benefits. Insurance companies continue to decide what doctors and hospitals workers can use.

Unions are playing in a ball park where the odds are stacked against them, a field dominated by private health insurance companies. Unions need a new arena where they can win the battle, improve coverage, and secure it once and for all.

Unions Have a Big Stake in Winning Single-Payer

Currently, nonunion employers undercut union ones by avoiding health care coverage. Ending this unfair advantage will be, like prevailing wage law, a crucial step for progress.

With single payer, unions’ ability to win contract struggles will be enhanced.  Now, for many unions, health coverage ends within 30 days of a work stoppage or lockout, placing outrageous pressure on workers to settle for less. With single payer, health coverage never ends.

With single payer in effect, unions, including those with multiemployer plans, can use their health care bargaining power to improve pensions, sick pay, and other benefits as well as wages.

Some union retirees currently have health benefits through VEBA’s. Many of these retirees are in jeopardy of benefit cuts due to rising health costs and limited VEBA funding.  With single payer the problem is solved.

Currently, many workers are fearful of organizing because they are afraid to risk losing health insurance coverage.  That risk will be gone with single payer.

Labor can win respect and gain support from those who are not in unions by defending not only its own members but by leading the fight for health care for all.

In countries that have a form of single payer universal care, a higher percentage of the workers are in unions. In 2011, rates of unionization were: Sweden  67.5%, Canada 26.8%, United Kingdom 25.6%, U. S. 11.3%. 

The Whole Country Wins with Single Payer

Union members are not the only ones in jeopardy now. Our states and cities are strapped by the health insurance burden that siphons public funds from education, jobs, and all the beneficial programs we need.

There’s nothing inevitable about the costly health insurance system we have in the U.S. where private insurance companies dictate what physicians workers can see and what claims to deny.

In fact, the U. S. is the only major industrialized nation that doesn’t have some type of national, universal health care.

Did You Know?

  • According to President Bill Clinton, the U.S. could save $1 trillion per year by adopting the health system of any other advanced country. 
  • The U.S. spends about twice as much per person on health care as other industrialized nations, yet our life expectancy, infant mortality, and other outcomes fall short.
  • 16% to 20% of the big private insurance companies’ premiums are wasted on marketing, CEO salaries, profits, paperwork and bureaucracy rather than health care services.
  • Drug prices in countries with national health systems are a third to a half lower than in the U.S.
  • Over 30 million will remain without health insurance even when the health reform bill (ACA) is fully implemented.
  • About 31% of U.S. health spending is on administration, most of it waste.
  • Tens of thousands of Americans die every year because of no health care coverage, and millions more, including those with insurance, forego care because of the cost.
  • Studies show a single-payer health care system would save $400 billion annually, enough to cover all the uninsured and to upgrade everyone’s coverage.
  • Under our employer-based system, if you lose your job, you lose your health insurance too — just when you need it the most!
  • More than half of personal bankruptcies are attributable to illness and medical bills.
  • With single payer, each person chooses their physicians, other caregivers, and hospitals.

The “Expanded & Improved Medicare for all Act,” H.R. 676

Congressman John Conyers Jr.(D-Mich.) has introduced H.R. 676 into every Congress since 2003.

This single-payer health care program proposes an effective mechanism for controlling skyrocketing health costs while covering all and improving health care for everyone.

H.R. 676 would cover every person in the U.S. for all necessary medical care including dental, prescription drugs, hospital, surgical, outpatient services, primary and preventive care, emergency services, oral surgery, periodontics, mental health, home health, physical therapy, rehabilitation (including for substance abuse), vision care, durable medical equipment, palliative, chiropractic and long-term care.

H.R. 676 ends deductibles and co-payments removing financial barriers to care.

In country after country, labor took the lead in championing universal health insurance. Labor’s leadership is essential to pass HR 676.

Some argue that labor shouldn’t advocate national health insurance because universal coverage would take away a major incentive for joining unions.

But countries with universal health insurance have a far higher proportion of workers in unions than the U.S. Unions can gain better wages, pensions, and working conditions if they aren’t locked into bargaining to retain essential health care benefits.

Some union members fear they would lose the level of benefits they’ve won if we had national health insurance. In fact, under the current system labor’s health benefits are threatened with every contract negotiation. With H.R. 676, all medically necessary care is covered with dental, drugs, long term care—many provisions that most workers don’t have now. Working people would have improved coverage and pay less.

That’s why it’s important for unions to take a stand for the best bill, H.R. 676, which would improve care for everyone.

There is an Alternative

Unions today face bitter opposition from attacks on workers’ rights to organize and bargain. Unions can take the offense by leading the fight for H.R. 676. By winning secure health care for everyone, unions will restore hope and confidence in the labor movement and open the door for further gains.

Over 600 union organizations, including 44 state AFL-CIOs, 147 CLCs, and the national AFL-CIO have come out in favor of Rep. John Conyers’ Expanded and Improved Medicare for All, H.R. 676. That list and a sample resolution are available on the website http://unionsforsinglepayer.org

Brochures with this message are available at cost upon request.  If your union would like to have a speaker on single payer or additional information, please contact:

All Unions Committee for Single Payer Health Care–HR 676
c/o Nurses Professional Organization
1169 Eastern Parkway #2218
Louisville, KY 40217
(502) 636-1551
nursenpo@aol.com

http://my.firedoglake.com/kaytillow/2014/08/18/unions-can-lead-the-struggle-for-single-payer-health-care/

It’s About Time to Enact a National Single-Payer Program

By the editors
Managed Care, August 2014

At a time when the Affordable Care Act is widely reviled and even liberals are lukewarm in their support, Ray E. Drasga, MD, is an outlier. Based partly on his experience at a free clinic in a middle-class town, he says the nation needs a single-payer system, that the ACA doesn’t go nearly far enough in covering the uninsured. And he’s not shy about it.

Crown Point, Ind., is a typical middle-class American town. Its 28,400 residents have a median household income of $64,900, well above the state-wide average of $48,400. Only 6.8 percent live below the federal poverty level, about half the statewide average of 14.7 percent.

Despite this level of wealth, Crown Point needs the St. Clare Health Clinic, which provides free health care services in its offices on Indiana Avenue, says Ray E. Drasga, MD, the clinic’s medical director. Although a $5 per visit donation is encouraged, health care is provided without charge.

“Even in a middle-class, well-off community like Crown Point there’s a big need for health care for those who are uninsured,” says Drasga, an oncologist. “This is not a lower socioeconomic area. And yet everybody knows someone who’s uninsured.”

Coverage concerns

The percentage of U.S. adults lacking insurance coverage dropped 17.1 percent in the first quarter of 2014 to 13.4 percent in the second quarter, according to Gallup, the polling organization. The 13.4 percent average for the second quarter of 2014 is the lowest level recorded since Gallup began tracking this measure in 2008.

While this news is positive, the ACA will not cover everyone. The Congressional Budget Office estimated in April that the number of uninsured will decline from about 42 million nonelderly Americans this year to about 31 million in 10 years.

Devastating costs 

“So the uninsured will still be with us for years to come,” says Drasga. Thus, there will still be a need for the free medical care in Crown Point and in other cities and towns nationwide.

In fact, Drasga makes the compelling case that the ACA, for all it will do for many Americans, is insufficient. Instead, the United States needs a single-payer health system that provides care for all. Before he retired recently after 30 years in practice, Drasga had seen firsthand the devastating effects that no insurance has on patients, particularly on those with cancer.

“Serving as medical director for the free clinic was something I did on the side, but still I saw very clearly that there is a significant need for health insurance for everyone. And, you could see the need very dramatically in people with cancer. Every now and then we’d have a patient with cancer at the free clinic or we had people calling our oncology practice who had no insurance. As an oncologist, you just knew and they knew that lacking health insurance was much more traumatic for cancer patients than it is for other patients because the cost of cancer care is astronomical now.”

Comparative costs

In an article in January in the Journal of Oncology Practice, “Why Oncologists Should Support Single-Payer National Health Insurance,” Drasga and Lawrence H. Einhorn, MD, point out that the cost of medications in the United States is higher than it is in any other developed country. The price of medications here is 50 percent higher than it is in other countries when prices tor equivalent molecules are compared, McKinsey & Co. said in a report. In addition, the overall price of drugs is more than 118 percent higher in the United States than it is in Europe because U.S. consumers use a more expensive mix of drugs, McKinsey said. (“Accounting for the Cost of U.S. Health Care: A new Look at Why Americans Spend More,” http://tinyurl.com/US-drug-costs.)

The nation’s largest health care purchaser, the Centers for Medicare & Medicaid Services, cannot negotiate for lower cost medications. “Other countries have committees that negotiate for lower drug prices and yet we don’t. So, basically we’re subsidizing the cost of drugs for the rest of the world.”

Yet the reaction among Drasga’s colleagues was muted, he says. And when Drasga was seeking a like-minded colleague in an academic setting to serve as coauthor, he was turned down repeatedly before Einhorn agreed. A pioneer in the treatment of testicular cancer, Einhorn is a professor in the division of hematology/oncology at the Indiana University School of Medicine. He is perhaps most famous for treating cyclist Lance Armstrong, not exactly in poverty at that time, for testicular cancer. Last year, OncLive, a group of publications covering cancer care, named Einhorn one of its 2013 Giants of Cancer Care.

“Most Americans are comfortable with the status quo or people believe there’s nothing they can do,” Drasga says. “They’re waiting for someone else to act. They’re watching what will happen in Vermont, for example.”

In 2011, the Vermont legislature passed and Gov. Pete Shumlin signed Act 48 into law, calling for the state to provide coverage for all 620,000 residents of the Green Mountain State by 2017. Today, Shumlin is still trying to find the $2 billion it will cost to pay for this system each year in a state with only $2.7 billion in annual tax revenue. Cost is certainly an issue with any single-payer system, but so is attachment to our current system, even among oncologists, Drasga laments. The struggle he had finding a coauthor is telling.

“I talked to heads of departments at universities but they had ties to drug companies that do research or were partially funded by pharmaceutical companies. They had a lot to lose by speaking out about the status quo.”

$2.7 trillion

In the journal article, the first point Drasga and Einhorn made was that the United States spends $2.7 trillion for health care. Doctors fear they may lose some of their income, he says. “If you’re a physician caring for patients, you don’t want to lose your share of that income. It comes down to economics because so many people want their piece of the pie.

“If a patient has advanced breast or colon cancer, it’s not unheard of to have a bill of $20,000 to $30,000 every two weeks. After seeing the doctor and getting a prescription for some new drugs, you may walk out with a $20,000 bill. Then you repeat that process two weeks later. The sad truth is that very quickly, treatment can run up to $100,000. The average person doesn’t have that type of money.

“Let’s say you have a mass in your neck and you have no insurance. It’s hard even to see a doctor, or get a biopsy or a scan. You can’t even start your treatment. That’s why people with cancer who are uninsured do very poorly. Their survival rates are much worse.”

The current system, even after the ACA reforms are implemented fully, does not go far enough, he concludes. While more Americans have insurance this year, many have high deductible health plans, leaving them underinsured, he notes.

Ray E. Drasga, MD, is a nationally known proponent single-payer health care system. A recently retired oncologist, Drasga has seen firsthand how treating cancer can leave many families in financial ruin. This article appeared under the rubric “The Contrarians” in the August issue of Managed Care.

http://managedcaremag.com/archives/2014/8/ray-e-drasga-md-its-about-time-enact-national-single-payer-program