PNHP

Paul Krugman: “Obamacare IS the conservative alternative”

Paul Krugman: “Obamacare IS the conservative alternative”

Obamacare Lives!

By Ross Douthat
The New York Times, March 31, 2014

Back when rate shock, website problems and lagging enrollment were threatening to unravel the new health care law before it fully took effect, I concluded a column on Obamacare’s repeated near-death experiences with the following warning to conservatives:

“The welfare state’s ability to defend itself against reform, however, carries a cautionary message for Obamacare’s critics as well. What isn’t killed outright grows stronger the longer it’s embedded in the federal apparatus, gaining constituents and interest-group support just by virtue of its existence even if it doesn’t work out the way it was designed. And as disastrous as its launch has been, if the health care law can survive this crisis in the same limping, staggering way it survived Scott Brown and the Supremes, then it will be a big step closer to being part of the status quo, with all the privileges and political strength that entails.

“So yes — it’s possible that this brush with death will be fatal, possible that the law will fall with the lightest, most politically painless push. But it’s still likely that Obamacare will be undone only if its critics are willing to do something more painful, and take their own turn wrestling with a system that resists any kind of change.”

With the latest numbers showing exchange enrollment climbing toward 7 million, I think we can safely retire that “possible,” and change the “likely” to an “all-but-definite.” Not because rising enrollment proves that Obamacare is definitely working, in the sense that both its friends and critics would have originally understood the term. We don’t know yet what the paid enrollment looks like or how successfully the program is actually enrolling the uninsured. (After some grim estimates, this Rand study is making liberals feel a little more optimistic, but still suggests a below-expectations result.) We don’t know what the age-and-health-status composition of the enrollee pools looks like or what that means for premiums next year and beyond. We don’t know if any of the suspended/postponed provisions of the law will actually take effect. And we certainly don’t know what any of this means for social policy in the long run.

But we do know that there won’t be an immediate political unraveling, and that we aren’t headed for the kind of extremely-low-enrollment scenario that seemed conceivable just a few months ago, or the possible world where cancellations had ended up outstripping enrollment, creating a net decline in the number of insured. And knowing that much has significant implications for our politics. It means that the kind of welfare-state embedding described above is taking place on a significant scale, that a large constituency will be served by Obamacare (through Medicaid as well as the exchanges) in 2016 and beyond, and that any kind of conservative alternative will have to confront the reality that the kind of tinkering-around-the-edges alternatives to Obamacare that many Republicans have supported to date would end up stripping coverage from millions of newly-insured Americans. That newly-insured constituency may not be as large as the bill’s architects originally hoped, or be composed of the range of buyers that the program ultimately needs. But it will be a fact on the ground to an extent that was by no means certain last December. And that fact will shape, and constrain, the options of the law’s opponents even in the event that Republicans manage to reclaim the White House two years hence.

Such political and policy constraints, I should note, are potentially a good thing for would-be conservative reformers, since the serious right-of-center alternatives to Obamacare have always included policies to expand coverage, and with a coverage expansion accomplished, Republicans may find themselves effectively forced in a more serious direction. (This is a drum that Avik Roy, among others, has been beating for some time.) Or so I would hope; of course, they might just end up drifting toward gimmicky micro-reforms instead, or find themselves embroiled a ruinous civil war over how hard to push toward some kind of full repeal.

But wherever they go and whatever they do, they will have to deal with the reality that Obamacare, thrice-buried, looks very much alive.

==

Obamacare, The Unknown Ideal

By Paul Krugman

No, I haven’t lost my mind — or suddenly become an Ayn Rand disciple. It’s not my ideal; in a better world I’d call for single-payer, and a significant role for the government in directly providing care.

But Ross Douthat, in the course of realistically warning his fellow conservatives that Obamacare doesn’t seem to be collapsing, goes on to tell them that they’re going to have to come up with a serious alternative.

But Obamacare IS the conservative alternative, and not just because it was originally devised at the Heritage Foundation. It’s what a health-care system that does what even conservatives say they want, like making sure that people with preexisting conditions can get coverage, has to look like if it isn’t single-payer.

I don’t really think one more repetition of the logic will convince many people, but here we go again. Suppose you want preexisting conditions covered. Then you have to impose community rating — insurers must offer the same policies to people regardless of medical history. But just doing that causes a death spiral, because people wait until they’re sick to buy insurance. So you also have to have a mandate, requiring healthy people to join the risk pool. And to make buying insurance possible for people with lower incomes, you have to have subsidies.

And what you’ve just defined are the essentials of ObamaRomneyCare. It’s a three-legged stool that needs all three legs. If you want to cover preexisting conditions, you must have the mandate; if you want the mandate, you must have subsidies. If you think there’s some magic market-based solution that obviates the stuff conservatives don’t like while preserving the stuff they like, you’re deluding yourself.

What this means in practice is that any notion that Republicans will go beyond trying to sabotage the law and come up with an alternative is fantasy. Again, Obamacare is the conservative alternative, and you can’t move further right without doing no reform at all.

Douthat: http://douthat.blogs.nytimes.com/2014/03/31/obamacare-lives/

Krugman: http://krugman.blogs.nytimes.com/2014/03/31/obamacare-the-unknown-ideal/

There have been many isolated efforts to define the conservative, or Republican, or libertarian proposal to replace the Affordable Care Act (ACA or Obamacare), but there is no one model that the Republicans wish to advance in Congress at this time. The Republican controlled House of Representatives has voted fifty times to repeal ACA, but they have not voted on any substitute to address the widely acknowledged deficiencies in health care financing.

Conservative Ross Douthat and liberal Paul Krugman now provide us with a perspective on the conservative/Republican alternative for reform.

Douthat acknowledges that a conservative goal is to expand coverage (especially for the more vulnerable), whereas the current “tinkering-around-the-edges alternatives to Obamacare that many Republicans have supported to date would end up stripping coverage from millions of newly-insured Americans.” He suggests that the policy restraints of an ACA already in place would force Republicans “in a more serious direction.”

Krugman, on the other hand, writes, “Obamacare IS the conservative alternative.” Not only does it meet many of the conservative goals of insurance reform, it was even designed by the conservatives. The liberal position would have been to support a single payer model.

Single payer was abandoned in favor of the conservative model that would bring Republicans on board with a new, post-partisan president, while liberals would forfeit the single payer advantages in exchange for a politically feasible, bipartisan accord.

Think of where that puts us now. If the conservatives were to gain complete control, they would tweak ACA to loosen regulation of insurers, to reduce federal funding, and to place greater control within the states. If the liberals were to gain complete control, they would tweak ACA to correct many of the defects that were left in place when the negotiations refining the legislation were halted abruptly because of the Democrats having lost a filibuster-proof majority in the Senate (not to mention the sabotage of a former Democratic vice-presidential nominee).

The fact that further battles will all take place over on the right is a tragedy. The fundamental structure of ACA is irreparably flawed, as would be any modifications that the Republicans would make to move the insurance function further into the private marketplace. Already we have seen a great multitude of very serious flaws that scream out for remedial legislation. But each new patch creates more complexity. The fundamental infrastructure cannot be repaired by patches. We need a new infrastructure (and it would be better and cheaper!).

Krugman says, “in a better world I’d call for single-payer.” Let’s make this a better world.

The High Burden of Health Care Costs on Insured Adults

Beyond Coverage: The High Burden of Health Care Costs on Insured Adults in Massachusetts

By Sharon K. Long
BCBS of Mass Foundation, RWJ Foundation, Urban Institute, March 2014

These findings highlight the vulnerability that Massachusetts families experience when faced with high health care costs. Overall, 42.5 percent of all nonelderly adults in the state reported that health care costs had resulted in financial problems or health care access problems for their families in the past year, with the burden greater for low-income adults (46.5 percent for those with income at or below 138 percent FPL) and middle-income adults (53.9 percent for those with income between 139 and 399 percent FPL). Nearly three-quarters (70.6 percent) of those who were uninsured for all or part of the year reported problems with health care costs. However, neither higher income nor health insurance coverage protected Bay State families: 31.7 percent of higher-income adults and 38.7 percent of adults with insurance coverage for the full year also reported that health care costs had resulted in problems for their families.

Health care costs are creating difficult choices for families in Massachusetts. Insured adults frequently reported going without needed care because of costs, cutting back on non-health-related spending to pay for health care, and reducing their family’s financial security to pay for health care, both by reducing savings and by taking on debt, including credit card debt. As a result, medical debt had a significant impact on many families, particularly middle-income families, with contacts from collection agencies quite common.

http://bluecrossmafoundation.org/sites/default/files/download/publication/MHRS%20Beyond_Coverage.pdf

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Health Insurance Coverage Is Just The First Step: Findings From Massachusetts

By Sharon Long, Kate Willrich Nordahl, Kaitlyn Kenney Walsh, Kathy Hempstead, and Ariel Fogel
Health Affairs Blog, March 26, 2014

The challenges faced by low-income and middle-income Massachusetts families are particularly worrisome given that the consumer protections for out-of-pocket health care costs are generally better in Massachusetts than those required under the ACA. For individuals with family income between 100 and 200 percent of poverty who are enrolled in the state’s subsidized health insurance program, out-of-pocket spending for covered prescriptions and medical services is limited to $1,000 per benefit year. The ACA allows individuals in this income cohort to have out-of-pocket costs that can sum to more than double this amount ($2,250).

http://healthaffairs.org/blog/2014/03/26/health-insurance-coverage-is-just-the-first-step-findings-from-massachusetts/

Comment:

By Don McCanne, MD

The provisions of the Affordable Care Act (ACA) have provided the nation with health care coverage similar to that which has existed in Massachusetts. However, “the consumer protections for out-of-pocket health care costs are generally better in Massachusetts than those required under the ACA.” Though Massachusetts has better coverage, “Overall, 42.5 percent of all nonelderly adults in the state reported that health care costs had resulted in financial problems or health care access problems for their families in the past year.”

Over half of middle-income adults in Massachusetts also “reported that health care costs had resulted in financial problems or health care access problems for their families.”

Furthermore, “neither higher income nor health insurance coverage protected Bay State families: 31.7 percent of higher-income adults and 38.7 percent of adults with insurance coverage for the full year also reported that health care costs had resulted in problems for their families.”

This is the shocking truth about our new national standard of underinsurance: In spite of having greater financial protection than that offered through the Affordable Care Act, over one-half of middle-income adults and nearly one-third of higher-income adults in Massachusetts still had problems with health care costs. And many of those who didn’t have problems likely avoided them by being fortunate enough to remain healthy. That is not the way an egalitarian health care financing system should work.

This ACA turkey won’t fly. All of us, including many of those with higher incomes, would benefit from single payer.

Tell Obama: ACA’s a scam, we need Medicare for All

Why I am a conscientious objector to the ACA 

By Margaret Flowers, M.D.
PopularResistance.org, March 28, 2014

I have been an outspoken advocate for a Medicare for all health system. During the health reform process, I did all that I could to push for single payer, including being arrested three times for civil disobedience. I was one of fifty doctors who filed a brief in the Supreme Court which expressed opposition to forcing people to buy private health insurance, a defective product. It pains me to see that the Affordable Care Act (ACA) siphons billions of public dollars to create more bureaucracy and transfers hundreds of billions of public dollars directly to the private insurance industry when I know that those dollars should be paying for the health care that so many in our country desperately need.

I am currently uninsured, so I have to make a choice. I don’t qualify for Medicaid and I’m too young for Medicare. By law, I am required to buy private insurance or pay a penalty. But I find myself in the position of not being able to do either. I can’t in good conscience give money to the health insurance industry that I am fighting to eliminate. And I can’t in good conscience pay a tax penalty that will be given to that industry. So, I am going to be a Conscientious Objector to the ACA.

I suspect that there are others who feel as I do. If you are planning to object to purchasing insurance and you support Medicare for all, you might like to join me in sending a letter to President Obama. See the petition here.

The issue is access to care, not the number who buy insurance

As the March 31 deadline to purchase health insurance or face a penalty approaches, the public debate is focused solely on enrollment numbers. Great efforts are being expended to compel people to buy insurance. The “Young Invincibles,” a term created to misrepresent uninsured young adults, are being marketed heavily. And Enroll America, a coalition of advocates and health industry executives, is working overtime to encourage volunteers to be creative in the ways they locate and convince people to purchase insurance.

The mass media and politicians are constantly talking about the health care marketplace. We are being indoctrinated with market rhetoric. Patients are called consumers and health insurance plans are called products. The problem with this is that health care doesn’t belong in the marketplace whose logic dictates that care should be denied if a profit cannot be made. Health care is a public good and something that everyone needs throughout their lifetime.

Focusing solely on the number of people who are insured is what the private health insurance industry wants the public to believe is most important. The industry spent tremendous amounts of money and time to get a law that would force people to buy insurance in order to protect and enhance their assets. They want everyone to buy their products and to make people feel reckless or irresponsible if they don’t. This is a massive campaign to distract people from asking the questions that really matter, such as whether people with insurance will be able to afford health care, whether bankruptcies from medical debt will continue and whether overall health outcomes will improve.

In the United States, having health insurance does not guarantee access to necessary health care. In fact, rather than creating health security, the ACA is degrading health care coverage in the US. It is also creating the largest transfer of public dollars to a private industry ever, as UNITE HERE reports “most of the ACA’s $965 billion in subsidies will go directly to commercial insurance companies.”

The insurance scam

biggest insurance scams in history. It has made the already complex American health system, which spends over a third of health care dollars on insurance-created bureaucracy rather than care, much more complicated. It is based on principles that are the opposite of what are proven to be effective. Instead of being universal, everybody automatically enrolled as we did for seniors when Medicare started in 1965 and as most other industrialized nations do, we created a conservative, means-tested system that depends on individual income.

And instead of creating a single standard of care, so that everyone has access to the health care they need, the ACA locked into law a tiered system of coverage based on different metals: platinum, gold, silver and bronze. Though they may sound good, it turns out that the upper tier plans are not any better than the lower tier plans in terms of what services are covered or where patients can go for care. The major difference is whether a person chooses to pay more up front in higher premiums and pay less when they need health care (upper tier plans) or chooses to gamble on staying healthy and pay less up front, risking higher out-of-pocket costs if they need care (lower tier plans). This is essentially a pay-now-or-pay-later scheme.

And it is a scheme, because there are no guarantees that people who have insurance will be protected from financial ruin if they have a serious health problem. It is essential to remember that nothing about the basic business model of insurance companies has changed. They exist to make a profit and they are very good at it. While they complain about the ACA, because its regulations require more work on their end to find ways around them, it has been very lucrative for them. Health insurance stock values have doubled since the law passed in 2010.

One of their major work-arounds is the use of >narrow and ultra-narrow provider networks to discourage patients with pre-existing conditions from buying their plans and leave patients footing more of the bill. Narrow networks exclude at least 30% of local hospitals and ultra-narrow networks exclude at least 70%. This means that if the local cancer center isn’t included in a plan, then people with cancer are unlikely to buy that plan. To make it worse, it’s difficult for patients to determine what providers are included in different plans because the information on the insurance exchange websites has been found to be wrong half the time.

The reason for the narrow networks is that when patients don’t go to an approved health provider, they bear most or all of the costs. The limit on how much money people can be required to spend in addition to premiums doesn’t apply when patients go out of network (and the limit was removed for 2014 anyway). In practice, if someone develops a serious health condition and the hospital or health professional that treats the condition is not in their network, they will have to go without care or find a way to pay for it. And if a person has a serious accident and is taken to a hospital that is out of network, the patient will again bear the total cost. Buying insurance is a health care crap shoot.

The race to the bottom in health care benefits

Medical bankruptcy and self-rationing, foregoing necessary care due to cost, are two products of our market-based health system and we can expect them to continue under the ACA, even as more people become insured. Supporters of the ACA often quote the slowed rise of health care spending that has been happening since the financial crash in 2008. They claim it is a sign of the law’s positive effect; however, the slowing is actually due to fewer people using health services. In 2012, 80 million people went without necessary care because of cost.

Self-rationing will continue because there has not been an economic recovery for most of us. More than 80% of people are buying lower tier health plansthat require high up-front payments for care at a time when most families are living paycheck to paycheck. The number of people who are considered poor or low income is rising. And, as Paul Bucheit writes, if we updated our standards for measuring poverty to reflect the current economic realities (the costs of food, housing, health care, education, etc), the poverty threshold would be over three times higher than it is now. He adds that half of the US population owns zero wealth because of debt. It is a sad irony that people are being forced to pay monthly premiums for health insurance that will leave them without money for actual care.

And now that lower coverage plans are legal, they are accelerating the race to the bottom in employer health benefits. Employers are shifting more of the cost of health care onto employees, reducing coverage for dependents, moving employees into private insurance exchanges (which do not qualify for subsidies) and penalizing employees for poor health habits, which places the blame for health problems on the individual without acknowledging that many drivers of poor health are out of the individual’s control. While tying health care to employment is not ideal, in the US at least the employer-based plans used to provide better benefits than those on the individual market.

The practical solution

The solution to the ongoing health care crisis is obvious. We need to reverse direction completely and move to a national publicly-funded health insurance for everyone. Some call this a single payer or ‘Medicare for all’ plan. We are already spending enough on health care in the US to provide high quality care to everyone. It is just wrong from a standpoint of what works to continue shifting more of our health care dollars to bureaucracy instead of to care and to the private insurance industry which is designed to keep as much for itself as it can get away with. It is immoral to protect insurance company profits instead of protecting the health and well-being of our people.

Putting our money into the insurance industry is a step in the wrong direction.  The Expanded and Improved Medicare for All Act, HR 676, in Congress, would eliminate the insurance industry and create lifelong comprehensive coverage for everyone. No matter what you choose to do about insurance, tell your Congress member to support HR 676. And if you are one of the millions who do not plan to buy insurance, join me in telling Obama why. See the petition above.

P.S. For those that are deciding not to buy private insurance, Lawrence O’Donnell reports that we have little to fear:

MSNBC host Lawrence O’Donnell is not one of them. Ever since the law passed, he has told his viewers to not fear the individual mandate. He said it again on The Last Word with Lawrence O’Donnell on Oct. 21, 2013 while scolding a White House correspondent.

“No one ever really has to pay the fine in the individual mandate,” O’Donnell said, “because the IRS has been specifically forbidden, in writing, in law, in the Affordable Care Act, from ever actually pursuing either civil or criminal remedies to collect those fines from anyone. The individual mandate is the only provision in the tax code that was written deliberately to be essentially unenforceable.”

http://www.popularresistance.org/tell-obama-acas-a-scam-we-need-medicare-for-all/

The High Burden of Health Care Costs on Insured Adults

Beyond Coverage: The High Burden of Health Care Costs on Insured Adults in Massachusetts

By Sharon K. Long
BCBS of Mass Foundation, RWJ Foundation, Urban Institute, March 2014

These findings highlight the vulnerability that Massachusetts families experience when faced with high health care costs. Overall, 42.5 percent of all nonelderly adults in the state reported that health care costs had resulted in financial problems or health care access problems for their families in the past year, with the burden greater for low-income adults (46.5 percent for those with income at or below 138 percent FPL) and middle-income adults (53.9 percent for those with income between 139 and 399 percent FPL). Nearly three-quarters (70.6 percent) of those who were uninsured for all or part of the year reported problems with health care costs. However, neither higher income nor health insurance coverage protected Bay State families: 31.7 percent of higher-income adults and 38.7 percent of adults with insurance coverage for the full year also reported that health care costs had resulted in problems for their families.

Health care costs are creating difficult choices for families in Massachusetts. Insured adults frequently reported going without needed care because of costs, cutting back on non-health-related spending to pay for health care, and reducing their family’s financial security to pay for health care, both by reducing savings and by taking on debt, including credit card debt. As a result, medical debt had a significant impact on many families, particularly middle-income families, with contacts from collection agencies quite common.

http://bluecrossmafoundation.org/system/assets/drupal/download/publicatio…

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Health Insurance Coverage Is Just The First Step: Findings From Massachusetts

By Sharon Long, Kate Willrich Nordahl, Kaitlyn Kenney Walsh, Kathy Hempstead, and Ariel Fogel
Health Affairs Blog, March 26, 2014

The challenges faced by low-income and middle-income Massachusetts families are particularly worrisome given that the consumer protections for out-of-pocket health care costs are generally better in Massachusetts than those required under the ACA. For individuals with family income between 100 and 200 percent of poverty who are enrolled in the state’s subsidized health insurance program, out-of-pocket spending for covered prescriptions and medical services is limited to $1,000 per benefit year. The ACA allows individuals in this income cohort to have out-of-pocket costs that can sum to more than double this amount ($2,250).

http://healthaffairs.org/blog/2014/03/26/health-insurance-coverage-is-ju…

The provisions of the Affordable Care Act (ACA) have provided the nation with health care coverage similar to that which has existed in Massachusetts. However, “the consumer protections for out-of-pocket health care costs are generally better in Massachusetts than those required under the ACA.” Though Massachusetts has better coverage, “Overall, 42.5 percent of all nonelderly adults in the state reported that health care costs had resulted in financial problems or health care access problems for their families in the past year.”

Over half of middle-income adults in Massachusetts also “reported that health care costs had resulted in financial problems or health care access problems for their families.”

Furthermore, “neither higher income nor health insurance coverage protected Bay State families: 31.7 percent of higher-income adults and 38.7 percent of adults with insurance coverage for the full year also reported that health care costs had resulted in problems for their families.”

This is the shocking truth about our new national standard of underinsurance: In spite of having greater financial protection than that offered through the Affordable Care Act, over one-half of middle-income adults and nearly one-third of higher-income adults in Massachusetts still had problems with health care costs. And many of those who didn’t have problems likely avoided them by being fortunate enough to remain healthy. That is not the way an egalitarian health care financing system should work.

This ACA turkey won’t fly. All of us, including many of those with higher incomes, would benefit from single payer.

Canada is paying more and getting less from private insurers

Canadians spend more on private health insurance for smaller payouts

Medical Xpress, March 24, 2014

Spending by Canadians on private health insurance has more than doubled over the past 20 years, but insurers paid out a rapidly decreasing proportion as benefits, according to a study published today in the CMAJ (Canadian Medical Association Journal).

The study, by University of British Columbia and University of Toronto researchers, shows that overall Canadians paid $6.8 billion more in premiums than they received in benefits in 2011.

Approximately 60 per cent of Canadians have private health insurance. Typically obtained as a benefit of employment or purchased by individuals, private health insurance usually covers prescription drugs, dental services and eye care costs not paid by public health care.

Over the past two decades, the gap between what insurers take in and what they pay out has increased threefold. While private insurers paid out 92 per cent of group plan insurance premiums as benefits in 1991, they paid only 74 per cent in 2011. Canadians who purchased individual plans fared even worse, with just 38 per cent of their premiums returned as benefits in 2011.

“Small businesses and individual entrepreneurs are the hardest hit – they end up paying far more for private health coverage,” says study lead author Michael Law, an assistant professor in UBC’s Centre for Health Services and Policy Research, “It’s essentially an extra health tax on one of our main economic drivers.

“Our findings suggest that private insurers are likely making greater profits, paying higher wages to their executives and employees, or spending more on marketing,” Law adds.

http://medicalxpress.com/news/2014-03-inefficiency-private-health-canada.html

CMAJ article (first page, paywall for rest): http://www.cmaj.ca/content/early/2014/03/24/cmaj.130913.extract

Comment:

By Don McCanne, MD

Although Canada’s single payer system provides excellent coverage for most health care, a market for private health insurance sprung up to cover prescription drugs, dental services and eye care that were not covered by the original program. The for-profit insurers did what they are expected to do. They began by retaining 8 percent of premiums for administrative costs and profits. But after two decades, they now retain as much as 62 percent of premiums for profits, high executive compensation, marketing and other administrative costs.

Although some are calling for more regulation of Canada’s private insurers, they should have learned from the experience in the United States. No amount of regulation will eliminate their inefficiencies and waste. Coverage for these services should be rolled over into the public single payer system.

Opponents protest that Canada cannot afford to offer these benefits in their public program. Nonsense. Most Canadians are already receiving drugs, dental care and eye care, and it is being paid for out-of-pocket or through private insurance. The money is already being spent; it just needs to be spent better. Placing these benefits into the public program would do the following things: 1) administered pricing would ensure value, 2) financial barriers to care would be reduced, 3) financing would be more equitable, and 3) the excesses and waste of the private insurers would be eliminated.

When we enact our single payer system here in the United States, we’ll need to be sure that we don’t make the same mistakes as Canada, though they are far fewer than our blunders.

Canada is paying more and getting less from private insurers

Canadians spend more on private health insurance for smaller payouts

Medical Xpress, March 24, 2014

Spending by Canadians on private health insurance has more than doubled over the past 20 years, but insurers paid out a rapidly decreasing proportion as benefits, according to a study published today in the CMAJ (Canadian Medical Association Journal).

The study, by University of British Columbia and University of Toronto researchers, shows that overall Canadians paid $6.8 billion more in premiums than they received in benefits in 2011.

Approximately 60 per cent of Canadians have private health insurance. Typically obtained as a benefit of employment or purchased by individuals, private health insurance usually covers prescription drugs, dental services and eye care costs not paid by public health care.

Over the past two decades, the gap between what insurers take in and what they pay out has increased threefold. While private insurers paid out 92 per cent of group plan insurance premiums as benefits in 1991, they paid only 74 per cent in 2011. Canadians who purchased individual plans fared even worse, with just 38 per cent of their premiums returned as benefits in 2011.

“Small businesses and individual entrepreneurs are the hardest hit – they end up paying far more for private health coverage,” says study lead author Michael Law, an assistant professor in UBC’s Centre for Health Services and Policy Research, “It’s essentially an extra health tax on one of our main economic drivers.

“Our findings suggest that private insurers are likely making greater profits, paying higher wages to their executives and employees, or spending more on marketing,” Law adds.

http://medicalxpress.com/news/2014-03-inefficiency-private-health-canada…

CMAJ article (first page, paywall for rest):http://www.cmaj.ca/content/early/2014/03/24/cmaj.130913.extract

Although Canada’s single payer system provides excellent coverage for most health care, a market for private health insurance sprung up to cover prescription drugs, dental services and eye care that were not covered by the original program. The for-profit insurers did what they are expected to do. They began by retaining 8 percent of premiums for administrative costs and profits. But after two decades, they now retain as much as 62 percent of premiums for profits, high executive compensation, marketing and other administrative costs.

Although some are calling for more regulation of Canada’s private insurers, they should have learned from the experience in the United States. No amount of regulation will eliminate their inefficiencies and waste. Coverage for these services should be rolled over into the public single payer system.

Opponents protest that Canada cannot afford to offer these benefits in their public program. Nonsense. Most Canadians are already receiving drugs, dental care and eye care, and it is being paid for out-of-pocket or through private insurance. The money is already being spent; it just needs to be spent better. Placing these benefits into the public program would do the following things: 1) administered pricing would ensure value, 2) financial barriers to care would be reduced, 3) financing would be more equitable, and 3) the excesses and waste of the private insurers would be eliminated.

When we enact our single payer system here in the United States, we’ll need to be sure that we don’t make the same mistakes as Canada, though they are far fewer than our blunders.

Jimmy Carter says Medicare should be expanded to all ages

President Jimmy Carter: “A Call To Action”

The Diane Rehm Show, March 26, 2014

Diane Rehm: Briefly, how do you feel about the Affordable Care Act?

President Jimmy Carter: I was disappointed the way it was done and the complexity that it assumed. Instead of taking a leadership role from the White House and saying, “This is what we think is best,” they had five different congressional committees do it and it got, I think, the lowest common denominator, which is the most complex system. I would really have favored just the expansion of Medicare to include all ages, rather than just to deal with old people.

Video (38 second clip of quote above; also full 51 minute video): http://thedianerehmshow.org/shows/2014-03-26/president-jimmy-carter-call-action

Comment:

By Don McCanne, MD

Characterizing the Affordable Care Act as “the lowest common denominator – the most complex system,” President Jimmy Carter tells us that he would have favored “the expansion of Medicare to include all ages.”

He’s right, and here’s why. There have been numerous analyses of multiple models of reform. Most of them have included a model that would build on our private insurance system and expand Medicaid, just as is found in the Affordable Care Act. Of these analyses, this is the most expensive model and it falls short on important goals such as universality, equity, administrative efficiency, and affordability.

In contrast, single payer is the least expensive of the effective models and achieves virtually all of the goals of reform. An improved version of Medicare that is expanded to include everyone would be such a model. A health service model – socialized medicine – would also work, but the nation is still too leery of that much government involvement. The popularity of Medicare indicates that this is about the level of government involvement that most would support.

We have to keep reminding Americans that the exchanges are marketing private insurance – not government insurance, so they cannot confuse a government exchange with government insurance. In fact, the exchanges are prohibited from even including a government “public option” (which wouldn’t have worked anyway since the rest of the fragmented, dysfunctional system would have been left in place). Those who defend the private Medicare Advantage plans have to be reminded that they burn up more taxpayer dollars for administration and profits while depriving patients of choice because of their limited networks of providers. Once payment between government Medicare and private Medicare Advantage is equalized, the the private insurers cannot possibly compete with the government program because of their inherent inefficiencies. This was already proven by the failure of the Medicare + Choice plans that preceded Medicare Advantage.

It’s too bad that Jimmy Carter didn’t start talking about Medicare for all when he was president. It might have been helpful if the public had had a few decades to think about it before we got to the point that legislation could be passed. They could have pressured the politicians to do it right.

Don’t quit before you start

By Ellen Oxfeld
Rutland (Vt.) Herald, March 27, 2014

This week in a Vermont Public Radio interview, Senate President Pro Tem John Campbell backed away from an unwavering commitment to the historic task set out in Act 48 — creating a publicly funded guaranteed health care system for all Vermonters.

Campbell’s stated reason for this is disappointing. He demurred that he was not sure that a single-payer financing plan would be “politically viable” in the Legislature because of the “costs” of single payer.

Senator Campbell needs to reconsider. It’s true that financing a single-payer plan will cost about $2 billion; but that is actually less than we Vermonters are already paying. (In fact, in 2011, we Vermonters paid $2.5 billion in private premiums and out-of-pockets for our health care.)

It is also odd to see a Senate leader shrinking from his delegated role of doing just what he has been selected to do, lead. In the past, Senator Campbell has been a leader on many issues, such as marriage equality and in passing Act 48, the 2011 road map legislation for single-payer. Yes, successfully enacting an equitable and viable single-payer financing package will not be easy. It will take political courage.

But the facts support moving forward, not giving up before even trying. After all, in five official studies commissioned since 2001 by the state of Vermont, the conclusion has always been the same — there is no other way to guarantee health care for all Vermonters while containing costs other than a publicly financed (“single-payer”) system.

The Senate president stated that he would like an “alternate” plan in case single-payer financing does not work out. But we already have an alternate plan in place — the Affordable Care Act. And although that act has certainly helped some individuals to purchase private insurance, it still leaves in place our multi-tiered system of different private plans, with different levels of coverage and the expenses created by the complex administration of such a system.

Furthermore, a situation in which there are multiple levels of private plans can never guarantee access to health care for all. It can still leave people with inadequate financial protection, or even without health care coverage at all, in the event that they change jobs, lose jobs, or experience changes in their financial status.

Act 48 was not passed on a fanciful whim. It passed because it built upon two decades of experience and numerous studies. Alternatives to a publicly financed health care plan for all were studied and tried, but none offered the possibility of both universality and cost control. Publicly financed systems throughout the world surpass our present system by guaranteeing access to health care for all while simplifying administration and containing costs effectively.

The vision of guaranteed health care and an affordable health care system can be reached in Vermont. Vermonters will be ill served if our political leaders step away from the road map laid out in Act 48, which they voted for and passed.

Ellen Oxfeld is a resident of Middlebury.

http://www.rutlandherald.com/article/20140327/OPINION04/703279947

Jimmy Carter says Medicare should be expanded to all ages

President Jimmy Carter: “A Call To Action”

The Diane Rehm Show, March 26, 2014

Diane Rehm: Briefly, how do you feel about the Affordable Care Act?

President Jimmy Carter: I was disappointed the way it was done and the complexity that it assumed. Instead of taking a leadership role from the White House and saying, “This is what we think is best,” they had five different congressional committees do it and it got, I think, the lowest common denominator, which is the most complex system. I would really have favored just the expansion of Medicare to include all ages, rather than just to deal with old people.

Video (38 second clip of quote above; also full 51 minute video):http://thedianerehmshow.org/shows/2014-03-26/president-jimmy-carter-call…

Characterizing the Affordable Care Act as “the lowest common denominator – the most complex system,” President Jimmy Carter tells us that he would have favored “the expansion of Medicare to include all ages.”

He’s right, and here’s why. There have been numerous analyses of multiple models of reform. Most of them have included a model that would build on our private insurance system and expand Medicaid, just as is found in the Affordable Care Act. Of these analyses, this is the most expensive model and it falls short on important goals such as universality, equity, administrative efficiency, and affordability.

In contrast, single payer is the least expensive of the effective models and achieves virtually all of the goals of reform. An improved version of Medicare that is expanded to include everyone would be such a model. A health service model – socialized medicine – would also work, but the nation is still too leery of that much government involvement. The popularity of Medicare indicates that this is about the level of government involvement that most would support.

We have to keep reminding Americans that the exchanges are marketing private insurance – not government insurance, so they cannot confuse a government exchange with government insurance. In fact, the exchanges are prohibited from even including a government “public option” (which wouldn’t have worked anyway since the rest of the fragmented, dysfunctional system would have been left in place). Those who defend the private Medicare Advantage plans have to be reminded that they burn up more taxpayer dollars for administration and profits while depriving patients of choice because of their limited networks of providers. Once payment between government Medicare and private Medicare Advantage is equalized, the the private insurers cannot possibly compete with the government program because of their inherent inefficiencies. This was already proven by the failure of the Medicare + Choice plans that preceded Medicare Advantage.

It’s too bad that Jimmy Carter didn’t start talking about Medicare for all when he was president. It might have been helpful if the public had had a few decades to think about it before we got to the point that legislation could be passed. They could have pressured the politicians to do it right.

Obamacare is not universal health care

The Affordable Care Act leaves some of our neediest citizens without insurance or a reliable source of care

By Max Romano
The Baltimore Sun, March 26, 2014

Mary is single, in her late 50s, widowed and earning about $2,000 a month cleaning bathrooms downtown. She’s had no health insurance for the last decade, but she’s received medical care when she needed it at free clinics and emergency rooms.

But now it’s the era of Obamacare, and Mary hears that she has to buy health insurance. We check her options on Maryland Health Connection, the state’s online health insurance exchange:

The cheapest “bronze plan” is only $2.20 per month, which will avoid a year-end fine for being uninsured, but it pays for little up until the $6,000 deductible. The “silver plans” cost $130 to $360 per month with a $900 annual deductible, but for those she’d have to choose between a health savings account, a limited HMO provider network, a 40 percent or a $40 co-pay, and many other confusing options.

None of it sounds like straightforward “affordable care” to her.

This isn’t a story about error messages or frozen screens. Website crashes make news; they don’t make history. This is about the real implications of Obamacare, about which ideas work in real life and which just sound good on paper.

Mary was just one of dozens of low-income Baltimoreans I met as a health insurance enrollment volunteer in a Baltimore free clinic over the past six months, but she shares the experience of thousands of Marylanders this season. Once the website glitches subsided, the reality set in that the government was telling uninsured people to spend a significant portion of their incomes on health insurance. I have seen how many low-income Marylanders will remain uninsured after the March 31st deadline because of the cost and complexity of buying insurance.

If we really want universal health care, we need a public system that actually includes all people, such as extending Medicare to all Americans. Obamacare’s individual mandate to buy health insurance does not reach everyone because many uninsured individuals will not “buy-in” to an expensive and overly complex insurance system.

Unlike some critics, I do not think the Affordable Care Act (a.k.a. Obamacare) got everything wrong: It has made health insurance for individuals cheaper and better. Obamacare expands Medicaid to cover more low-income people, creates tax credits to make insurance cheaper for individuals, makes it illegal for insurance companies to deny coverage based on preexisting conditions and stops insurers from rescinding coverage when beneficiaries get sick.

But while Obamacare patches some of the gaping holes in the health insurance market, it also fails to create access for many of the people who never budgeted for insurance before. The bottom line is that Obamacare will insure millions, but it will also leave tens of millions of Americans still uninsured.

The only way to reach “universal coverage” would be for all Americans to be enrolled in basic public health insurance. This sort of “single-payer system” already exists for Americans over 65 (i.e. Medicare). While many politicians criticize single-payer systems, the millions of seniors who staunchly defend their Medicare are living proof that universal public coverage is worthwhile.

True universal coverage would protect our nation’s most vulnerable from medical bankruptcy, it would save tremendously on administrative costs currently siphoned off by the insurance industry, and it would vastly simplify insurance in this country.

Plans are in motion to create a universal public health insurance system for Vermonters of all ages, but the hodgepodge of government programs and private insurers in Maryland continues to leave some of our neediest without a reliable source of care.

In Washington, my very own U.S. Rep. Elijah Cummings co-sponsored the Expanded & Improved Medicare for All Act in 2013, which tried to create this kind of comprehensive system to insure every American, but he needs more allies in Congress to turn this bill into law. On a local level, “Healthcare is a Human Right — Maryland” is a grass roots alliance of physicians, labor groups, and other Marylanders working to promote true universal health care in our state, and they have several local organizing chapters that need your support.

After months of trying to help low-income Marylanders like Mary sign up, I’m more convinced than ever that Obamacare will not reach many of the people who need health insurance the most and that universal public coverage is the only way we can provide real health care for all in Maryland.

Max Romano is a medical student and public health student at Johns Hopkins University and a volunteer at the Shepherd’s Clinic, a free clinic for the uninsured in northeast Baltimore. The opinions expressed herein are the author’s alone and do not represent the views of Johns Hopkins University or the Shepherd’s Clinic. His email is mromano4@jhmi.edu.

http://www.baltimoresun.com/news/opinion/bs-ed-obamacare-medicare-20140326,0,5129108.story#ixzz2x5adCqZw

Matt Anderson questions his “medical home”

Nine Questions About My New Medical Home

By Matthew Anderson
Health Affairs Blog, March 17, 2014

Sometime in the past five years — it’s hard for me to say exactly when — I suddenly found myself living in a new home.  I must admit I am still a bit disoriented by how this happened. But it did. People keep telling me that everything will be ok but I am not entirely sure.

1. Is this a home or is it a hostel?

2. Will my old friends still be welcome in my new home?

3. Does Mommy love me or is she just paid to say so?

4. Why are we playing computer games during family time?

5. Are there any family secrets left?

6. Everyone tells me how important I am, so why is my allowance being cut?

7. Do I have to go to Church now?

8. Can we get some family therapy?

9. Can’t we afford a better home?

There was a time when family medicine saw itself as a counter-culture in medicine with a mission to incorporate a different set of values.  Our job should be to improve the wellbeing and health of our patients and their communities, not the bottom line of the corporations who thrive off our labor.

Such a dream will not happen until health care is seen as a public good instead of a private commodity.  A national health system, it seems, is the only economically rational and humane way forward.

Comment:

By Don McCanne, MD

What is a patient-centered medical home? To some it means the place you go to get health care – full primary care and a convenient and efficient entry path into more specialized services. To others it means a way of organizing the business of health care to make it more accountable for reducing costs, guided by the dictates of private insurers and government bureaucrats implementing the Affordable Care Act.

Matthew Anderson’s nine questions about the nature of the medical home should serve as a teaser to read the full article on the Health Affairs Blog. It is not simply about the medical home concept, but it questions the whole direction in which our health care system is headed. Not only should you read it, but you should download it and share it with others.

Dr. Anderson has the right values. He is a driving force behind The Social Medicine Portal (An Alternative to Corporate Health) and an editor of the journal, “Social Medicine.”

The Social Medicine Portal: http://www.socialmedicine.org/welcome-to-the-social-medicine-portal/

Social Medicine: http://www.socialmedicine.info/index.php/socialmedicine/index

Repeating his astute words, “Our job should be to improve the wellbeing and health of our patients and their communities, not the bottom line of the corporations who thrive off our labor. Such a dream will not happen until health care is seen as a public good instead of a private commodity.  A national health system, it seems, is the only economically rational and humane way forward.”

Of Patients and Prices

By A.W. Gaffney, M.D.
Truthout, March 26, 2014

There are many good reasons to impatiently anticipate the end of one’s medical training, which not infrequently lasts upwards of five years following medical school. But counterpoised to the oft-cited benefits — greater autonomy, reliably increased remuneration, less reliably improved hours, and so forth — there is also, unfortunately, an almost entirely unrecognized drawback: a largely unavoidable entanglement in the business of health care.

Now for some, such an entanglement might make the transition from training seem all the more attractive. But clearly, one need only hear about patients (or their surviving family members) being chased by collections agencies for medical bills, or about the growing problem of “medical bankruptcies” among the insured, or even about the bizarre unaffordability of asthma inhalers to see that something is seriously askew with the way the price of health care can adversely impact the circumstances of the ill. As my own clinical training now winds down, I frequently reflect on how to navigate today’s highly problematic health care terrain – in which patients are increasingly exposed to the cost of care provided.

I think it’s only fair to begin, however, by recognizing that unlike ethical issues revolving around artificial hearts or organ transplants, the problem of the cost of health care isn’t entirely new. Hippocrates (or whoever it was that wrote the Precepts) generally saw nothing wrong in doctors looking after their pecuniary interests, though he also opined that they mustn’t “extort money from those who are at death’s door.” The problem of US national health spending has likewise been recognized for some time: in 1971, as health care expenditures rapidly outstripped inflation, Richard Nixon proclaimed that the nation faced a “deepening crisis,” which has been more or less the conventional wisdom ever since (if not without reason).

However, an awareness that something might be awry with what prices patients were being charged by hospitals, physicians, pharmaceutical companies, ambulance companies and more or less everyone in the health care industry seems to have surged into the spotlight in more recent years. The journalist Steven Brill, for instance, in an important issue-length article “Bitter Pill” in Time last year, investigated the stories of patients who received massive itemized bills for health care, which, in several instances, might very well be termed “money from those who are at death’s door.”

He discussed one person, for instance, who between diagnosis with metastatic lung cancer and death a mere 11 months later had accumulated some $900,000 in medical bills, debt that was then dumped onto his devastated wife. Additionally jarring, however, was Brill’s exploration of the extremely high prices being charged for individual services or items to such patients (e.g. $77 for each tiny square of cotton gauze), which originated from a confidential list of hospital prices dubbed the “chargemaster.”

Elizabeth Rosenthal of the New York Times has explored the issue further in an ongoing and highly revealing series. Like Brill, she finds instances of absurd prices (e.g. $3,355.96 for five stitches in the ER), though in most cases, these prices are frequently several times higher than what insurance companies – which directly negotiate reimbursements with hospitals and providers – actually pay. However, for the uninsured, the “underinsured” (i.e. those who have insurance, but with high deductibles, coinsurance or copays), those who are out-of-network, or those who have limits on coverage, the “chargemaster” is real enough. For these individuals and families, massive and arbitrary medical bills – for conditions ranging from the trivial to the deadly – can be tantamount to financial ruin.

Why is this issue coming to the spotlight now? Partially, it’s a reflection of ongoing trends in the health care system that predated Obamacare but that are also not ended by it. Insured patients increasingly have more financial liability, or as the saying goes, “skin in the game,” when they receive health care. High-deductible employer plans are more and more common, “four-tier” prescription drug plans are the norm, and themost commonly purchased “silver” plans on the Obamacare exchanges have an actuarial value of only 70%. All of this equates to increased “cost sharing,” or out-of-pocket money paid for health care, on top of annual premiums (which are also rising). Between uninsurance and underinsurance, it’s not all that surprising that unpaid medical bills apparently constitute half of accounts reported to collection agencies, compromising the credit scores and the financial opportunities of those affected. Along similar lines, 62% of US bankruptcies, according to one study, are caused by medical illnesses – even though most of these bankrupt individuals actually had health insurance at the time of their illness.

Everyone agrees there is a problem here, but — not surprisingly — the fix is far more contested. For many, transparent and more reasonable prices are the key to the puzzle: as Rosenthal puts it, we could require health care providers to provide “price lists and upfront estimates to allow consumers to make better choices.” Brill likewise advocates for the elimination of the “chargemaster,” what he calls the “source of the poison coursing through the health care ecosystem.” And as it turns out, “price transparency” is already becoming a reality: since January 1 in Massachusetts, at least, doctors and hospitals are now required under law to provide price information on services and procedures to patients who request it.

From the physicians’ perspective, an awareness of patients’ rising financial liabilities has also led to a variety of proposals. Last summer, three physicians published an article entitled “First, Do No (Financial) Harm” in the Journal of the American Medical Association (JAMA), which argued that medical professionals nowadays must universally consider the financial ramifications of their decisions for patients before recommending care. A patient whose insurance didn’t cover physical therapy for lower back pain, they argue, might instead be directed to a less expensive local yoga class. Similarly, physicians could discuss options for avoiding hospitalizations in patients with high copays for inpatient stays.

Now, there seems nothing controversial about avoiding unnecessary hospitalizations, nor do I have anything against yoga. Saving money by prescribing the least expensive among a number of drugs with equal efficacy likewise is a no-brainer (regardless of the financial means or insurance of the patient). But consider how ethically problematic this whole framework is once we move beyond the low-hanging fruit. Should inferior but less costly procedures or treatments be recommended to poorer patients, or provided upon their request? Should a patient’s insurance deductible impact the decision of whether or not a hospitalization is indicated? Are we really ready for a multi-tiered medical system (superimposed on a multiplicity of already existing disparities) in which the therapy most likely to save a life or limb or palliate a symptom is no longer de facto optimal but is instead one of a number of options to be considered depending on the financial means of the patient?

Now, to be fair to the writers of the JAMA article, blithely ignoring the reality that one’s decisions have costs for patients — i.e. pretending that we now have a system of universal health care free at the point of service — doesn’t seem like a morally superior approach to take either. But this merely raises the question of why the spectrum of solutions proposed by most in the mainstream seems so impoverished. The JAMA piece provides a framework for adapting to the status quo, but doesn’t pass judgment on whether this is at all desirable. Brill, on the other hand, devotes considerable time in his article to discussing Medicare’s superior efficiency and ability to negotiate fair prices for health care services. Yet he doesn’t consider one natural conclusion from such logic: extending Medicare to the whole population. Rosenthal at one point expresses concern that the out-of-pocket limits of Obamacare plans (up to $12,700 annually for families on top of premiums) will mean that patients “will still not be very discerning shoppers.” Such logic, however, unfortunately takes it as a given that patients should be shoppers, and that substantial “cost sharing” (i.e. copays and deductibles) is inevitable, immutable and universal. A reader might not know, for instance, that Edward Kennedy proposed health care legislation in 1969 that would have established universal health care for the country with “first dollar” coverage. He or she might be similarly surprised to learn that the health care systems of many other countries generally score higher in terms of quality, cost about half of the US system, have no uninsurance, and have greatly limited – and in some cases zero – out-of-pocket expenses for patients at the point of care.

A reader might also be forgiven for walking away from these articles with the sense that transparent lists of reasonable health care prices would go some way toward solving the grave problems of the US health care system. Now transparency is almost always a good thing, and more reasonable prices might help the uninsured and underinsured from getting stuck with outlandish bills for minor treatments. On the other hand, such reforms will not be very useful in cases of major illness, and there isn’t any reason to conclude that they would reduce medical bankruptcies or control overall costs. Seriously ill? You could easily bump up against the $12,700 out-of-pocket annual maximum of your family’s health care plan by the time you’ve completed a year – or maybe even a month? – of a new cancer treatment.

As I complete my clinical training, I’ll soon — like most physicians — be submitting bills to insurance companies for procedures or services that I provide. These bills will, at times, land in the lap of the uninsured or underinsured. How should I proceed? I can certainly aim to pursue the least expensive among clinically equivalent therapies, and to avoid unhelpful tests or interventions altogether, though that seems like basic good practice regardless of the finances or insurance coverage of the patient. But what about the slippery slope that will inevitably appear when patients with competing financial obligations — rent, food, education, or even other health care needs — understandably seek to save their limited resources by pursuing inferior medicines, tests, or procedures? Down that road, there must be no doubt, lies class-based, not evidence-based, medicine: It is a road we cannot follow. The Confucian physician Chu Hui-ming, born some four centuries ago, wrote that “there are no two kinds of drugs for the lofty and the common; the poor and the rich receive the same medicine.” Do we believe this today?

There is, I believe, no satisfactory solution to this problem on the level of the individual practitioner, patient or even hospital. An awareness of the dangers of our path must therefore lead us away from contentment with the status quo, out of the currently accepted confines of the policy debate, and towards bolder alternatives. It has led in my case to a commitment to the establishment of a single-payer system, with national health insurance for all, free at the point of service. Many others — which in most polls now include a majority of physicians and the public — seem to feel similarly.

The alternative? A slow, lamentable drift toward the practice of medicine explicitly tiered by class, overlaid on a system already riven with rising inequality. Under such a system, the price of care might be transparent, but at a cost that would soon be unforgivable.

A.W. Gaffney is a physician and a writer with a focus on health care policy and politics. In addition to Truthout, his writing has appeared in Salon, Dissent, and In These Times. He blogs at www.theprogressivephysician.org and tweets at @awgaffney.

http://www.truth-out.org/news/item/22693-of-patients-and-prices