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.”

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.

http://healthaffairs.org/blog/2014/03/17/nine-questions-about-my-new-medical-home/

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.”

America’s Underinsured

By Cathy Schoen, Susan L. Hayes, Sara R. Collins, Jacob A. Lippa, and David C. Radley
The Commonwealth Fund, March 2014

The twin goals of health insurance are to enable affordable access to health care and to alleviate financial burdens when injured or sick. It is well known that the uninsured are at high risk of forgoing needed care and of struggling to pay medical bills when they cannot postpone care. Studies further find that insured people who are poorly protected based on their households’ out-of-pocket costs for medical care are also at risk of not being able to afford to be sick.

Using newly available data from census surveys, this report provides national and state-level estimates of the number of people and share of the population that were insured but living in households that spent a high share of annual income on medical care in 2011–12. In the analysis, we refer to these people as “underinsured.” However, this group is only one subset of the underinsured. Our estimates do not include insured people who needed care but went without it because of the out-of-pocket costs they would incur, or the insured who stayed healthy during the year but whose health insurance would have exposed them to high medical costs had they needed and sought care.

The analysis finds that in 2012, there were 31.7 million insured people under age 65 who were underinsured. Together with the 47.3 million who were uninsured, this means at least 79 million people were at risk for not being able to afford needed care before the major reforms of the Affordable Care Act took hold.

In all states, people with low incomes are at greatest risk for being underinsured or uninsured. Nationally, in 2012, nearly two-thirds (63%) of those with incomes below the federal poverty level were either underinsured or uninsured. Among those with incomes between 100 percent and 199 percent of poverty, nearly half (47%) were underinsured or uninsured.

A decade or more of people losing health coverage and a steady erosion in the financial protection of insurance has also put middle-income families at risk. In 2012, one of five people (20%) under age 65 with middle incomes (between 200% and 399% of poverty)—an estimated 15.6 million people—were either underinsured or had no health insurance.

Low- and Middle-Income Households Most at Risk

The exposure to high out-of-pocket medical care costs even when people have insurance reflects insurance trends — including higher deductibles and cost-sharing, as well as gaps in benefits or limits on coverage — in both the employer and individual insurance markets. This puts insured families at risk in terms of access to health care and financial well- being. Studies indicate that low- and middle-income insured individuals and families who face high out- of-pocket costs for medical care relative to their incomes are nearly as likely as the uninsured population to go without care because of costs, forgo care when sick, struggle to pay medical bills, or incur medical debt. Both population groups — underinsured and uninsured — are at far higher risk of access or medical bill concerns than those with more protective coverage.

Premiums for Employer-Sponsored Insurance Have Risen More Rapidly Than Incomes, Value of Benefits Declined

Over the past decade, the cost of health insurance has risen far faster than incomes for middle- and low-income working-age families.

At the same time that premiums have risen, the value of benefits has declined. Deductibles more than doubled for plans provided by larger and small employers. This increase — plus other cost-sharing or limits on benefits — has left insured patients paying a higher share of medical bills. With little or no growth in incomes over a decade, insurance and care have become less affordable.

Medicaid and Income-Related Premium Assistance

Using newly available information on out-of-pocket payments for premiums, we estimate that 29 million insured people — 11 percent of the total under-age-65 population and 13 percent of the insured population under age 65 — paid premiums that exceeded the Affordable Care Act premium contribution thresholds for those at their household income level before reforms. In other words, they had high premium out-of-pocket costs compared with incomes, with “high” defined as in excess of Affordable Care Act contribution thresholds.

However, not everyone who pays high premiums relative to income will be eligible for help. The 29 million insured people includes 13.7 million with incomes below 138 percent of poverty who are paying premiums above the Affordable Care Act thresholds for this group. Of these, 8.8 million had private insurance they bought on their own or through employers. Based on their income alone, they would likely be eligible for expanded Medicaid if their state decides to participate in Medicaid expansions.

For those with incomes above Medicaid eligibility, the law restricts eligibility for premium assistance in marketplaces to people buying insurance on their own and to workers who have employer coverage where the employee’s premium costs for self-only coverage exceeds 9.5 percent of income. Among the 29 million insured with high premium costs in 2012, 11.7 million had employer-sponsored coverage and incomes that would be too high to qualify for expanded Medicaid.

Medicaid Expansion Makes a Critical Difference

Many of the states not participating in Medicaid expansion have among the highest rates of uninsured or underinsured people as a share of their total state populations. Without Medicaid expansion, this vulnerable group will remain at high risk for access, health, and financial problems.

Changing the Insurance Map of the Country

Substantial gains, however, will depend on the plans people choose and state efforts to ensure high-value benefit designs and accessible networks. One concern is to what extent people with low or modest incomes will opt for “bronze” level plans. People choosing bronze-level plans will pay 40 percent of medical care costs on average and thus remain at financial risk. Additionally, in choosing a bronze plan, people with low incomes forgo the cost-sharing subsidies that are tied to silver plans that substantially reduce out-of-pocket spending for medical care. As of February 2014, 62 percent of those enrolling in the new marketplaces selected silver plans, 19 percent had selected gold or platinum, and 19 percent had selected bronze.

In addition, it is important to note that the Affordable Care Act’s limits on out-of-pocket costs for covered benefits also apply only to in-network providers. As discussed in a recent report profiling insured people with medical debt, even with the new limits, the insured may encounter high medical care costs if they receive care from out-of-network clinicians.

From the Conclusion

However, the new marketplaces offer plans that include substantial cost-sharing and annual caps on out-of-pocket patient costs that apply to in-network providers only. With these benefit designs, there is the risk that the nation could convert the uninsured into the underinsured and fail to stop the erosion in insurance protections for people with private insurance coverage.

Full report (40 pages – several Exhibits and Tables):
http://www.commonwealthfund.org/~/media/Files/Publications/Fund%20Report/2014/Mar/1736_Schoen_americas_underinsured.pdf

Comment:

By Don McCanne, M.D.

This Commonwealth Fund report provides an estimate of the numbers of underinsured – people who could experience financial hardships and impaired access in the face of medical need. Although the authors express optimism that the numbers of uninsured will decline as a result of the provisions of the Affordable Care Act (ACA), there is a high probability that there will be a substantial increase in the numbers of people who will be underinsured.

The private insurance design features supported by ACA makes continued underinsurance an inevitability. The insured are vulnerable because of low actuarial value plans with high-deductibles and other cost sharing, narrow and ultra-narrow networks that impair access to in-network providers, inadequacies of the subsidies, and the perpetuation of an expensive, administrative wasteful model of financing care – a model that we all pay for, including the underinsured.

What is not expressed in the Commonwealth data is the number of people who may not have attempted to access care because of concerns of high out-of-pocket costs. Studies have shown that these people do forgo care that they should have.

A sobering thought is the even larger numbers of individuals not represented in this study. These are the people who remained healthy and never had to test the adequacy of their insurance. Tens of millions of people are vulnerable and would become financially insecure if they did develop significant health problems. This includes many individuals with employer-sponsored insurance. They are underinsured and don’t know it.  Excluding these individuals from the underinsured count results in estimates far below the actual numbers.

The design of ACA makes it clear that both the uninsured and underinsured will remain a problem in the foreseeable future, but it will be underinsurance that will likely provoke widespread discontent. Its prevalence may well become the most compelling reason to abandon the perversities brought to us by the private insurance industry. People will be ready to replace our dysfunctional system with a single payer national health program that would eliminate, for everyone, financial barriers to health care.

America’s Underinsured

By Cathy Schoen, Susan L. Hayes, Sara R. Collins, Jacob A. Lippa, and David C. Radley
The Commonwealth Fund, March 2014

The twin goals of health insurance are to enable affordable access to health care and to alleviate financial burdens when injured or sick. It is well known that the uninsured are at high risk of forgoing needed care and of struggling to pay medical bills when they cannot postpone care. Studies further find that insured people who are poorly protected based on their households’ out-of-pocket costs for medical care are also at risk of not being able to afford to be sick.

Using newly available data from census surveys, this report provides national and state-level estimates of the number of people and share of the population that were insured but living in households that spent a high share of annual income on medical care in 2011–12. In the analysis, we refer to these people as “underinsured.” However, this group is only one subset of the underinsured. Our estimates do not include insured people who needed care but went without it because of the out-of-pocket costs they would incur, or the insured who stayed healthy during the year but whose health insurance would have exposed them to high medical costs had they needed and sought care.

The analysis finds that in 2012, there were 31.7 million insured people under age 65 who were underinsured. Together with the 47.3 million who were uninsured, this means at least 79 million people were at risk for not being able to afford needed care before the major reforms of the Affordable Care Act took hold.

In all states, people with low incomes are at greatest risk for being underinsured or uninsured. Nationally, in 2012, nearly two-thirds (63%) of those with incomes below the federal poverty level were either underinsured or uninsured. Among those with incomes between 100 percent and 199 percent of poverty, nearly half (47%) were underinsured or uninsured.

A decade or more of people losing health coverage and a steady erosion in the financial protection of insurance has also put middle-income families at risk. In 2012, one of five people (20%) under age 65 with middle incomes (between 200% and 399% of poverty)—an estimated 15.6 million people—were either underinsured or had no health insurance.

Low- and Middle-Income Households Most at Risk

The exposure to high out-of-pocket medical care costs even when people have insurance reflects insurance trends — including higher deductibles and cost-sharing, as well as gaps in benefits or limits on coverage — in both the employer and individual insurance markets. This puts insured families at risk in terms of access to health care and financial well- being. Studies indicate that low- and middle-income insured individuals and families who face high out- of-pocket costs for medical care relative to their incomes are nearly as likely as the uninsured population to go without care because of costs, forgo care when sick, struggle to pay medical bills, or incur medical debt. Both population groups — underinsured and uninsured — are at far higher risk of access or medical bill concerns than those with more protective coverage.

Premiums for Employer-Sponsored Insurance Have Risen More Rapidly Than Incomes, Value of Benefits Declined

Over the past decade, the cost of health insurance has risen far faster than incomes for middle- and low-income working-age families.

At the same time that premiums have risen, the value of benefits has declined. Deductibles more than doubled for plans provided by larger and small employers. This increase — plus other cost-sharing or limits on benefits — has left insured patients paying a higher share of medical bills. With little or no growth in incomes over a decade, insurance and care have become less affordable.

Medicaid and Income-Related Premium Assistance

Using newly available information on out-of-pocket payments for premiums, we estimate that 29 million insured people — 11 percent of the total under-age-65 population and 13 percent of the insured population under age 65 — paid premiums that exceeded the Affordable Care Act premium contribution thresholds for those at their household income level before reforms. In other words, they had high premium out-of-pocket costs compared with incomes, with “high” defined as in excess of Affordable Care Act contribution thresholds.

However, not everyone who pays high premiums relative to income will be eligible for help. The 29 million insured people includes 13.7 million with incomes below 138 percent of poverty who are paying premiums above the Affordable Care Act thresholds for this group. Of these, 8.8 million had private insurance they bought on their own or through employers. Based on their income alone, they would likely be eligible for expanded Medicaid if their state decides to participate in Medicaid expansions.

For those with incomes above Medicaid eligibility, the law restricts eligibility for premium assistance in marketplaces to people buying insurance on their own and to workers who have employer coverage where the employee’s premium costs for self-only coverage exceeds 9.5 percent of income. Among the 29 million insured with high premium costs in 2012, 11.7 million had employer-sponsored coverage and incomes that would be too high to qualify for expanded Medicaid.

Medicaid Expansion Makes a Critical Difference

Many of the states not participating in Medicaid expansion have among the highest rates of uninsured or underinsured people as a share of their total state populations. Without Medicaid expansion, this vulnerable group will remain at high risk for access, health, and financial problems.

Changing the Insurance Map of the Country

Substantial gains, however, will depend on the plans people choose and state efforts to ensure high-value benefit designs and accessible networks. One concern is to what extent people with low or modest incomes will opt for “bronze” level plans. People choosing bronze-level plans will pay 40 percent of medical care costs on average and thus remain at financial risk. Additionally, in choosing a bronze plan, people with low incomes forgo the cost-sharing subsidies that are tied to silver plans that substantially reduce out-of-pocket spending for medical care. As of February 2014, 62 percent of those enrolling in the new marketplaces selected silver plans, 19 percent had selected gold or platinum, and 19 percent had selected bronze.

In addition, it is important to note that the Affordable Care Act’s limits on out-of-pocket costs for covered benefits also apply only to in-network providers. As discussed in a recent report profiling insured people with medical debt, even with the new limits, the insured may encounter high medical care costs if they receive care from out-of-network clinicians.

From the Conclusion

However, the new marketplaces offer plans that include substantial cost-sharing and annual caps on out-of-pocket patient costs that apply to in-network providers only. With these benefit designs, there is the risk that the nation could convert the uninsured into the underinsured and fail to stop the erosion in insurance protections for people with private insurance coverage.

Full report (40 pages – several Exhibits and Tables):
http://www.commonwealthfund.org/~/media/Files/Publications/Fund%20Report…

This Commonwealth Fund report provides an estimate of the numbers of underinsured – people who could experience financial hardships and impaired access in the face of medical need. Although the authors express optimism that the numbers of uninsured will decline as a result of the provisions of the Affordable Care Act (ACA), there is a high probability that there will be a substantial increase in the numbers of people who will be underinsured.

The private insurance design features supported by ACA makes continued underinsurance an inevitability. The insured are vulnerable because of low actuarial value plans with high-deductibles and other cost sharing, narrow and ultra-narrow networks that impair access to in-network providers, inadequacies of the subsidies, and the perpetuation of an expensive, administrative wasteful model of financing care – a model that we all pay for, including the underinsured.

What is not expressed in the Commonwealth data is the number of people who may not have attempted to access care because of concerns of high out-of-pocket costs. Studies have shown that these people do forgo care that they should have.

A sobering thought is the even larger numbers of individuals not represented in this study. These are the people who remained healthy and never had to test the adequacy of their insurance. Tens of millions of people are vulnerable and would become financially insecure if they did develop significant health problems. This includes many individuals with employer-sponsored insurance. They are underinsured and don’t know it.  Excluding these individuals from the underinsured count results in estimates far below the actual numbers.

The design of ACA makes it clear that both the uninsured and underinsured will remain a problem in the foreseeable future, but it will be underinsurance that will likely provoke widespread discontent. Its prevalence may well become the most compelling reason to abandon the perversities brought to us by the private insurance industry. People will be ready to replace our dysfunctional system with a single payer national health program that would eliminate, for everyone, financial barriers to health care.

Newsmakers:
Karen Ignagni, President and CEO of America’s Health Insurance Plans (AHIP)

C-SPAN, March 21, 2014

Karen Ignagni:  I would say that what we’ve learned – and I want to go back to this whole transition point – the reason that the decision was made to allow people to stay in their plans is because there was concern being expressed about ten categories of coverage – no matter how meritorious each and every one of those benefits may be – for an individual purchasing, or a small business, sometimes from where they started, which, in general, the old market had very high deductibles – that’s what people preferred to buy because they wanted to keep their premiums low. Then if you take ten categories of coverage and you have a giant step up, well that is a bridge too far for some individuals. And that was being telegraphed pretty clearly in the fall, not from us but from people who were buying the product and would have to spend more. So I would create a lower tier so that people could gradually get into the program, so they could be part of the risk pool so we don’t hold the healthier people outside, so the process could be working the way it was designed, so we get the healthy and the sick. And I think doing things gradually, just from human nature perspective, it just makes more sense.

Marry Agnes Carey:  Wouldn’t a lot of healthy people congregate in that lower tier?

Karen Ignagni:  Not necessarily. We’re not seeing that right now in the bronze, silver and gold. I think by that hypothesis you would have expected an extraordinary amount of people to buy bronze and they have chosen more silver, which is not as high deductible. So they wanted to lower their deductibles. They’re willing to pay a little bit more per month. But the point is that people are choosing. What I would do is give people more choices. I just… human nature suggests that people like that. They’re in control if they have more choices.

http://www.c-span.org/video/?318396-1/newsmakers-karen-ignagnino

Comment:

By Don McCanne, M.D.

One of the more important goals of health care reform was to require plans to provide comprehensive benefits. Although, as with other compromises in the Affordable Care Act (ACA), the legislation fell short, at least they did require that ten categories of benefits be covered, even if insurers were allowed considerable flexibility within each of the ten categories. Now AHIP – the insurers’ lobby organization – is attempting to dismantle the benefit requirement.

Suppose we said that males could decline obstetrical benefits if they wanted to, or females could decline prostate cancer benefits, or non-drug using monogamists could decline HIV/AIDS benefits, or young invincibles could decline all benefits except physical trauma, or whatever, what would happen to the risk pooling function of insurance? Obviously that would violate one of the the most important functions of prepaid health care – pooling all risks. Fragmenting risks into a multitude of pools moves away from prepaid health care for everyone and toward each person becoming responsible for paying for the care they use. At the extreme is requiring everyone to pay full costs in cash. How far along that polarity do we move – moving from bad to worse?

Creating another tier below the lowest current metal level – bronze – meets the desires of insurers who want to expand their markets by offering really cheap plans that exclude major benefits, but it does so at a cost of breaking up the risk pools such that people with expected higher costs are concentrated in comprehensive plans, driving premiums up to ever less affordable levels.

“Erin,” responding on the KHN Blog, suggested that we call this new lower metal tier “pyrite” or fool’s gold.

Look how the insurance industry has manipulated the goals of health care reform:

* We wanted to include everyone, and 31 million people will be left out.

* We wanted to reduce financial barriers to care, and the insurers reduced the actuarial value of their plans by increasing financial barriers to care in the form of deductibles and other cost sharing.

* We wanted to slow total spending to sustainable levels. If that is successful under ACA, it will be accomplished by preventing access to essential health care through limited networks and excessive cost sharing, not through true efficiencies such as are found in single payer systems.

* We wanted to improve quality and instead the insurers sell us more worthless administrative services to play ACO and P4P games.

* We wanted to reduce administrative waste, and instead we add greater administrative complexity through the establishment of insurance exchanges and accountable care organizations.

* We wanted everyone to have comprehensive benefits, and now the insurers bring up the old saw about “giving people more choices” because that puts people “in control” and people “like that.” So let’s strip out their benefits so they can choose cheaper plans that relieve insurers of the pesky need of covering expensive disorders.

Single payer would have achieved these goals, but the insurers keep chiseling away at them to meet their own business needs while sacrificing health care for the people. We can’t seem to fix the insurers, so let’s get rid of them.

(Karen Ignagni said that people are willing to pay more for the silver plans in order to lower their deductibles, but that is not the reason. Since Congress knew that people would select plans with the lowest premiums and thus have grossly inadequate coverage – bronze plans with 60% actuarial value – they prohibited those selecting bronze plans from receiving cost-sharing subsidies for out-of-pocket expenses, forcing them to buy up at least to the still inadequate silver plans with 70% actuarial value. Karen Ignagni knows this, so she was being dishonest by covering it up with the people-liking-choice spin, when all choices are bad – except single payer of course.)

Newsmakers:
Karen Ignagni, President and CEO of America’s Health Insurance Plans (AHIP)

C-SPAN, March 21, 2014

Karen Ignagni:  I would say that what we’ve learned – and I want to go back to this whole transition point – the reason that the decision was made to allow people to stay in their plans is because there was concern being expressed about ten categories of coverage – no matter how meritorious each and every one of those benefits may be – for an individual purchasing, or a small business, sometimes from where they started, which, in general, the old market had very high deductibles – that’s what people preferred to buy because they wanted to keep their premiums low. Then if you take ten categories of coverage and you have a giant step up, well that is a bridge too far for some individuals. And that was being telegraphed pretty clearly in the fall, not from us but from people who were buying the product and would have to spend more. So I would create a lower tier so that people could gradually get into the program, so they could be part of the risk pool so we don’t hold the healthier people outside, so the process could be working the way it was designed, so we get the healthy and the sick. And I think doing things gradually, just from human nature perspective, it just makes more sense.

Marry Agnes Carey:  Wouldn’t a lot of healthy people congregate in that lower tier?

Karen Ignagni:  Not necessarily. We’re not seeing that right now in the bronze, silver and gold. I think by that hypothesis you would have expected an extraordinary amount of people to buy bronze and they have chosen more silver, which is not as high deductible. So they wanted to lower their deductibles. They’re willing to pay a little bit more per month. But the point is that people are choosing. What I would do is give people more choices. I just… human nature suggests that people like that. They’re in control if they have more choices.

http://www.c-span.org/video/?318396-1/newsmakers-karen-ignagnino

One of the more important goals of health care reform was to require plans to provide comprehensive benefits. Although, as with other compromises in the Affordable Care Act (ACA), the legislation fell short, at least they did require that ten categories of benefits be covered, even if insurers were allowed considerable flexibility within each of the ten categories. Now AHIP – the insurers’ lobby organization – is attempting to dismantle the benefit requirement.Suppose we said that males could decline obstetrical benefits if they wanted to, or females could decline prostate cancer benefits, or non-drug using monogamists could decline HIV/AIDS benefits, or young invincibles could decline all benefits except physical trauma, or whatever, what would happen to the risk pooling function of insurance? Obviously that would violate one of the the most important functions of prepaid health care – pooling all risks. Fragmenting risks into a multitude of pools moves away from prepaid health care for everyone and toward each person becoming responsible for paying for the care they use. At the extreme is requiring everyone to pay full costs in cash. How far along that polarity do we move – moving from bad to worse?

Creating another tier below the lowest current metal level – bronze – meets the desires of insurers who want to expand their markets by offering really cheap plans that exclude major benefits, but it does so at a cost of breaking up the risk pools such that people with expected higher costs are concentrated in comprehensive plans, driving premiums up to ever less affordable levels.

“Erin,” responding on the KHN Blog, suggested that we call this new lower metal tier “pyrite” or fool’s gold.

Look how the insurance industry has manipulated the goals of health care reform:

* We wanted to include everyone, and 31 million people will be left out.

* We wanted to reduce financial barriers to care, and the insurers reduced the actuarial value of their plans by increasing financial barriers to care in the form of deductibles and other cost sharing.

* We wanted to slow total spending to sustainable levels. If that is successful under ACA, it will be accomplished by preventing access to essential health care through limited networks and excessive cost sharing, not through true efficiencies such as are found in single payer systems.

* We wanted to improve quality and instead the insurers sell us more worthless administrative services to play ACO and P4P games.

* We wanted to reduce administrative waste, and instead we add greater administrative complexity through the establishment of insurance exchanges and accountable care organizations.

* We wanted everyone to have comprehensive benefits, and now the insurers bring up the old saw about “giving people more choices” because that puts people “in control” and people “like that.” So let’s strip out their benefits so they can choose cheaper plans that relieve insurers of the pesky need of covering expensive disorders.

Single payer would have achieved these goals, but the insurers keep chiseling away at them to meet their own business needs while sacrificing health care for the people. We can’t seem to fix the insurers, so let’s get rid of them.

(Karen Ignagni said that people are willing to pay more for the silver plans in order to lower their deductibles, but that is not the reason. Since Congress knew that people would select plans with the lowest premiums and thus have grossly inadequate coverage – bronze plans with 60% actuarial value – they prohibited those selecting bronze plans from receiving cost-sharing subsidies for out-of-pocket expenses, forcing them to buy up at least to the still inadequate silver plans with 70% actuarial value. Karen Ignagni knows this, so she was being dishonest by covering it up with the people-liking-choice spin, when all choices are bad – except single payer of course.)

Obamacare Limits Choices Under Some Plans

By John Tozzi
Bloomberg Businessweek, March 20, 2014

Ben Rosenthal was treated for prostate cancer four years ago and had gallbladder surgery the year before that. A former manager at a market-research firm in Los Angeles, Rosenthal, 57, paid for his own health insurance. Last fall, when his plan was discontinued because it didn’t meet standards set by the Affordable Care Act, Rosenthal bought the best insurance coverage he could find, a top-tier “platinum” policy from Blue Shield of California that costs $792 a month. He figured it would provide access to top hospitals. Then in February he learned the plan wouldn’t cover the hospitals where he was used to being treated.

Rosenthal is one of millions of Americans who have purchased insurance under the Affordable Care Act and are discovering that many of the new plans offer a narrow network of doctors and facilities. “If I had anything happen, I wouldn’t want to go to a hospital that I’m not familiar with and with doctors I don’t know,” he says.

Since the ACA created marketplaces for private health plans last fall, insurers expecting to lure customers with low premiums have fashioned smaller networks of medical providers. By cutting out expensive hospitals and negotiating favorable rates with doctors in exchange for sending more patients their way, insurers can keep premiums down. Blue Shield’s new network includes 43 hospitals in Los Angeles County, about 64 percent of what its standard coverage offers, spokeswoman Lindy Wagner says in an e-mail.

In addition to having fewer options, buyers are making decisions about which plans to buy based on incomplete or misleading information, says Karen Pollitz, senior fellow at the Kaiser Family Foundation, a health policy research group. “Consumers have a very limited ability to shop in advance and evaluate provider networks,” she says.

Plans on healthcare.gov and state marketplaces are required to include links to directories that show which providers accept the insurance. But the information is often missing, wrong, or difficult to navigate, says Oliver Kharraz, chief operating officer of ZocDoc, an online appointment booking company. ZocDoc tried to verify the accuracy of hundreds of directories by calling doctors listed as in-network providers. About half the listings were wrong, Kharraz says. The California exchange, one of 15 state marketplaces that operate independently of healthcare.gov, created a central directory on its website but took it down on Feb. 6 because of errors.

Pressures on insurers to keep premiums low—state regulators can reject plans that are priced too high—may mean patients will have to learn to live with restricted choices. “The industry’s had to find ways to cut costs,” says Hasday of Frenkel Benefits. The result, he says, is “much less transparent for the consumer.”

Reader comment: John Alexander

I had the exact same problem as Mr. Rosenthal only in Florida with Blue Cross Blue Shield. Got screwed, as I also picked the Platinum plan and found out my hospital and doctors were not covered. The best research I did before hand indicated I would be covered and found after the fact I was not. Got furious with BCBS and they agreed to correct a few cost items with my doctors. They are playing dollar games with our health and I am completely frustrated. I am not upset with Obama-Care, only with the sligh and sneaky Insurance companies. Cannot drop my insurance and/or change until November of this year. What a fiasco. A singly payer system would correct all of this smoke and mirror games played by the Insurance industry.

http://www.businessweek.com/articles/2014-03-20/obamacare-limits-choices-under-some-plans

****

In Obamacare, go for bronze health plans. For most people, buying up to gold or platinum plans is a waste of money

By Scott Gottlieb
The American Enterprise Institute (AEI), January 24, 2014

We analyzed dozens of Obamacare plans, and found one striking result. The networks of providers, and in many cases the drug formularies, are the same whether you’re buying a particular insurer’s bronze plan, or purchasing the same insurance option in a gold or platinum offering. My American Enterprise Institute colleague Kelly Funderburk and I posted some of our data here.

The bottom line is this. When you’re choosing a particular insurance offering, you typically can’t trade up to a better benefit by buying the gold or platinum variety of that plan. It’s usually the exact same benefit regardless of the metal you choose.

So what varies between these different metal plans? Typically, just the co-pay structure and deductibles. As you pay higher premiums for a gold or platinum plan, your deductibles and co-pays will decline. The insurer will typically cover 60 percent of expected medical expenses in a bronze plan, 80 percent in a gold plan and 90 percent in a platinum plan. So, by buying the costlier plans, all you’re doing is fronting a higher premium to buy down your anticipated out of pocket costs. You’re not getting a better network of doctors or a better formulary of drugs.

http://www.aei.org/article/health/in-obamacare-go-for-bronze-health-plans-for-most-people-buying-up-to-gold-or-platinum-plans-is-a-waste-of-money/

Data to support this claim: http://www.scribd.com/doc/201871033/Comparison-of-Bronze-Versus-Platinum-Obamacare-Plans

****

Hospital networks: Configurations on the exchanges and their impact on premiums

McKinsey & Company, December 14, 2013

Narrow and ultra-narrow hospital networks are more prevalent (70 percent of all networks), increasing the variety of network configurations available to consumers

Broader network offerings are fewer than in 2013, yet remain available in almost every rating area we analyzed. The prevalence of narrower networks varies across markets, with the average percent contraction of incumbents’ network breadth between 2013 individual market networks and 2014 individual exchange networks ranging from 11 to 60 percent.

Products with broad hospital networks reveal higher premiums, with a median premium increase of 26 percent between broad and narrower networks of the same carrier, product type (e.g., HMO, PPO), metal tier, and rating area. Also, the majority (84 percent) of lowest-price silver products utilizes narrow or ultra-narrow networks

Across silver tier networks in our 20 analyzed rating areas, 58 percent of the lowest-price products utilize ultra-narrow networks and another 26 percent utilize narrow networks. Network breadth appears to be positively correlated with premium levels in many cases, but the use of narrower networks is common at all price points.

http://www.mckinsey.com/client_service/healthcare_systems_and_services/latest_thinking

****

Out-of-network coverage in New York? We left it up to the insurers

By Craig Gurian
Remapping Debate, October 30, 2013

New York’s health insurance exchange (called “NY State of Health”) offers individuals and families numerous insurance plan options at various “metal” levels. What it doesn’t offer in most parts of the state are plans that provide coverage for non-emergency out-of-network care. In a sample Manhattan zip code, for example, there are 62 plans available at all metal levels. Not one of those plans pays for out-of-network care.

Why then did New York State not require out-of-network coverage? “We left it up to the insurers,” said (Department of Health’s Randi) Imbriaco, and the insurers, she continued, arguing that “a closed network helps keeps costs low,” chose not to provide out-of-network coverage in most of New York State, including New York City (some plans in the western part of New York State do offer such coverage).

Dr. Andrew D. Coates is an internist based in upstate New York who is president of Physicians for a National Health Program (PNHP), an organization that advocates for a single-payer health insurance system. Coates, who was speaking during the interview for himself and not as a representative of PNHP, agreed with the idea that the lack of out-of-network options would enhance the ability of insurance companies to engage in cost cutting, regardless of whether patients were harmed, as, for example, in a push for doctors to see more and more patients each day.

He thought that doctors were increasingly being put in an “ethical bind” where their medical instincts might tell them in a particular instance to recommend an out-of-network physician — the “one oncologist that you can think of that should really evaluate what to do next” in the case of a rare cancer — even as they knew that following that recommendation would be financially ruinous for the patient.

More broadly, in Coates’ view, the greater empowerment of insurance companies was accelerating a turn towards “a corporate medical model that threatens to squeeze the humanity out of our interaction with our patients.”

http://www.remappingdebate.org/article/out-network-coverage-new-york-we-left-it-insurers

Comment:

By Don McCanne

According to the Bloomberg Businessweek report, Ben Rosenthal and reader John Alexander purchased the highest tier plans available – platinum plans – to ensure that they would have coverage for their current physicians and hospitals. No way. Insurers have pushed the perversity of narrow network plans all the way to the top.

Before Barack Obama was even nominated, the Democratic strategists had already decided that “Choice” would be a campaign slogan to market health care reform. Some of us protested that Celinda Lake and Herndon Alliance were pushing “choice of private health plans” when what the Democrats should have been advocating was “choice of physicians and hospitals.” It is clear which faction won this debate, as single payer supporters had the door slammed on them.

But look at the consequences. We were promised that we would have our choice of any plan we wanted with benefits as rich as desired, and with a selection of any health care providers we preferred. We could choose our doctors and our hospitals. But what happened?

So they did set up four levels of plans that we could choose from, plus a fifth catastrophic plan as an option for younger individuals. So we could buy a cheap bronze plan that would cover an average of 60 percent of our health care costs, 70 percent for silver, 80 percent for gold, all the way up to an expensive platinum plan that would cover 90 percent of costs. But there would be only negligible differences in the benefits since all plans had to cover the same ten categories of benefits, though some variation within each category is allowed as long as it had the same actuarial value.

But the shocker is the networks that the insurers established. As the AEI report indicates, for plans offered by the same insurer in the same market, the provider networks were just as limited for the high end platinum plans as they were for the cheapest bronze plans. If you want your medical bills paid, you do not have a choice of physicians and hospitals. You have to stay in network. Typically seventy percent of the providers are outside of the narrow network plans offered through the exchanges.

The Remapping Debate report reveals a further complication. Previously plans were available that provided reduced payments for care obtained out of network, with the patient paying a greater share of the costs. Now in areas such as New York City, none of these plans are available through the exchanges. You must stay in network or pay the full bill.

According to the McKinsey report, in some markets plans are available with broader networks, but these are less prevalent and declining in availability, and they are exorbitantly expensive. They will likely be subject to the death spiral since most markets do not have enough super wealthy individuals to maintain a vibrant market of broad network plans. The super wealthy then will simply pay their own bills.

So the Democrats traded off our choice of physicians and hospitals for a choice of deductibles and copayments, as the insurers took away the choices that we actually wanted. The narrow and ultra-narrow networks were a decision of the insurers, not us. We are getting what they want rather than what we want, simply because the Affordable care Act was designed to leave the insurers in charge.

As we’ve said before, all of this would go away if only we would enact a single payer national health program. As PNHP president Andy Coates says, physicians are placed in an “ethical bind” as they practice under “a corporate medical model that threatens to squeeze the humanity out of our interaction with our patients.”

Obamacare Limits Choices Under Some Plans

By John Tozzi
Bloomberg Businessweek, March 20, 2014

Ben Rosenthal was treated for prostate cancer four years ago and had gallbladder surgery the year before that. A former manager at a market-research firm in Los Angeles, Rosenthal, 57, paid for his own health insurance. Last fall, when his plan was discontinued because it didn’t meet standards set by the Affordable Care Act, Rosenthal bought the best insurance coverage he could find, a top-tier “platinum” policy from Blue Shield of California that costs $792 a month. He figured it would provide access to top hospitals. Then in February he learned the plan wouldn’t cover the hospitals where he was used to being treated.

Rosenthal is one of millions of Americans who have purchased insurance under the Affordable Care Act and are discovering that many of the new plans offer a narrow network of doctors and facilities. “If I had anything happen, I wouldn’t want to go to a hospital that I’m not familiar with and with doctors I don’t know,” he says.

Since the ACA created marketplaces for private health plans last fall, insurers expecting to lure customers with low premiums have fashioned smaller networks of medical providers. By cutting out expensive hospitals and negotiating favorable rates with doctors in exchange for sending more patients their way, insurers can keep premiums down. Blue Shield’s new network includes 43 hospitals in Los Angeles County, about 64 percent of what its standard coverage offers, spokeswoman Lindy Wagner says in an e-mail.

In addition to having fewer options, buyers are making decisions about which plans to buy based on incomplete or misleading information, says Karen Pollitz, senior fellow at the Kaiser Family Foundation, a health policy research group. “Consumers have a very limited ability to shop in advance and evaluate provider networks,” she says.

Plans on healthcare.gov and state marketplaces are required to include links to directories that show which providers accept the insurance. But the information is often missing, wrong, or difficult to navigate, says Oliver Kharraz, chief operating officer of ZocDoc, an online appointment booking company. ZocDoc tried to verify the accuracy of hundreds of directories by calling doctors listed as in-network providers. About half the listings were wrong, Kharraz says. The California exchange, one of 15 state marketplaces that operate independently of healthcare.gov, created a central directory on its website but took it down on Feb. 6 because of errors.

Pressures on insurers to keep premiums low—state regulators can reject plans that are priced too high—may mean patients will have to learn to live with restricted choices. “The industry’s had to find ways to cut costs,” says Hasday of Frenkel Benefits. The result, he says, is “much less transparent for the consumer.”

Reader comment: John Alexander

I had the exact same problem as Mr. Rosenthal only in Florida with Blue Cross Blue Shield. Got screwed, as I also picked the Platinum plan and found out my hospital and doctors were not covered. The best research I did before hand indicated I would be covered and found after the fact I was not. Got furious with BCBS and they agreed to correct a few cost items with my doctors. They are playing dollar games with our health and I am completely frustrated. I am not upset with Obama-Care, only with the sligh and sneaky Insurance companies. Cannot drop my insurance and/or change until November of this year. What a fiasco. A singly payer system would correct all of this smoke and mirror games played by the Insurance industry.

http://www.businessweek.com/articles/2014-03-20/obamacare-limits-choices…

****

In Obamacare, go for bronze health plans. For most people, buying up to gold or platinum plans is a waste of money

By Scott Gottlieb
The American Enterprise Institute (AEI), January 24, 2014

We analyzed dozens of Obamacare plans, and found one striking result. The networks of providers, and in many cases the drug formularies, are the same whether you’re buying a particular insurer’s bronze plan, or purchasing the same insurance option in a gold or platinum offering. My American Enterprise Institute colleague Kelly Funderburk and I posted some of our data here.

The bottom line is this. When you’re choosing a particular insurance offering, you typically can’t trade up to a better benefit by buying the gold or platinum variety of that plan. It’s usually the exact same benefit regardless of the metal you choose.

So what varies between these different metal plans? Typically, just the co-pay structure and deductibles. As you pay higher premiums for a gold or platinum plan, your deductibles and co-pays will decline. The insurer will typically cover 60 percent of expected medical expenses in a bronze plan, 80 percent in a gold plan and 90 percent in a platinum plan. So, by buying the costlier plans, all you’re doing is fronting a higher premium to buy down your anticipated out of pocket costs. You’re not getting a better network of doctors or a better formulary of drugs.

http://www.aei.org/article/health/in-obamacare-go-for-bronze-health-plan…

Data to support this claim: http://www.scribd.com/doc/201871033/Comparison-of-Bronze-Versus-Platinum…

****

Hospital networks: Configurations on the exchanges and their impact on premiums

McKinsey & Company, December 14, 2013

Narrow and ultra-narrow hospital networks are more prevalent (70 percent of all networks), increasing the variety of network configurations available to consumers

Broader network offerings are fewer than in 2013, yet remain available in almost every rating area we analyzed. The prevalence of narrower networks varies across markets, with the average percent contraction of incumbents’ network breadth between 2013 individual market networks and 2014 individual exchange networks ranging from 11 to 60 percent.

Products with broad hospital networks reveal higher premiums, with a median premium increase of 26 percent between broad and narrower networks of the same carrier, product type (e.g., HMO, PPO), metal tier, and rating area. Also, the majority (84 percent) of lowest-price silver products utilizes narrow or ultra-narrow networks

Across silver tier networks in our 20 analyzed rating areas, 58 percent of the lowest-price products utilize ultra-narrow networks and another 26 percent utilize narrow networks. Network breadth appears to be positively correlated with premium levels in many cases, but the use of narrower networks is common at all price points.

http://www.mckinsey.com/client_service/healthcare_systems_and_services/l…

****

Out-of-network coverage in New York? We left it up to the insurers

By Craig Gurian
Remapping Debate, October 30, 2013

New York’s health insurance exchange (called “NY State of Health”) offers individuals and families numerous insurance plan options at various “metal” levels. What it doesn’t offer in most parts of the state are plans that provide coverage for non-emergency out-of-network care. In a sample Manhattan zip code, for example, there are 62 plans available at all metal levels. Not one of those plans pays for out-of-network care.

Why then did New York State not require out-of-network coverage? “We left it up to the insurers,” said (Department of Health’s Randi) Imbriaco, and the insurers, she continued, arguing that “a closed network helps keeps costs low,” chose not to provide out-of-network coverage in most of New York State, including New York City (some plans in the western part of New York State do offer such coverage).

Dr. Andrew D. Coates is an internist based in upstate New York who is president of Physicians for a National Health Program (PNHP), an organization that advocates for a single-payer health insurance system. Coates, who was speaking during the interview for himself and not as a representative of PNHP, agreed with the idea that the lack of out-of-network options would enhance the ability of insurance companies to engage in cost cutting, regardless of whether patients were harmed, as, for example, in a push for doctors to see more and more patients each day.

He thought that doctors were increasingly being put in an “ethical bind” where their medical instincts might tell them in a particular instance to recommend an out-of-network physician — the “one oncologist that you can think of that should really evaluate what to do next” in the case of a rare cancer — even as they knew that following that recommendation would be financially ruinous for the patient.

More broadly, in Coates’ view, the greater empowerment of insurance companies was accelerating a turn towards “a corporate medical model that threatens to squeeze the humanity out of our interaction with our patients.”

http://www.remappingdebate.org/article/out-network-coverage-new-york-we-…

According to the Bloomberg Businessweek report, Ben Rosenthal and reader John Alexander purchased the highest tier plans available – platinum plans – to ensure that they would have coverage for their current physicians and hospitals. No way. Insurers have pushed the perversity of narrow network plans all the way to the top.

Before Barack Obama was even nominated, the Democratic strategists had already decided that “Choice” would be a campaign slogan to market health care reform. Some of us protested that Celinda Lake and Herndon Alliance were pushing “choice of private health plans” when what the Democrats should have been advocating was “choice of physicians and hospitals.” It is clear which faction won this debate, as single payer supporters had the door slammed on them.

But look at the consequences. We were promised that we would have our choice of any plan we wanted with benefits as rich as desired, and with a selection of any health care providers we preferred. We could choose our doctors and our hospitals. But what happened?

So they did set up four levels of plans that we could choose from, plus a fifth catastrophic plan as an option for younger individuals. So we could buy a cheap bronze plan that would cover an average of 60 percent of our health care costs, 70 percent for silver, 80 percent for gold, all the way up to an expensive platinum plan that would cover 90 percent of costs. But there would be only negligible differences in the benefits since all plans had to cover the same ten categories of benefits, though some variation within each category is allowed as long as it had the same actuarial value.

But the shocker is the networks that the insurers established. As the AEI report indicates, for plans offered by the same insurer in the same market, the provider networks were just as limited for the high end platinum plans as they were for the cheapest bronze plans. If you want your medical bills paid, you do not have a choice of physicians and hospitals. You have to stay in network. Typically seventy percent of the providers are outside of the narrow network plans offered through the exchanges.

The Remapping Debate report reveals a further complication. Previously plans were available that provided reduced payments for care obtained out of network, with the patient paying a greater share of the costs. Now in areas such as New York City, none of these plans are available through the exchanges. You must stay in network or pay the full bill.

According to the McKinsey report, in some markets plans are available with broader networks, but these are less prevalent and declining in availability, and they are exorbitantly expensive. They will likely be subject to the death spiral since most markets do not have enough super wealthy individuals to maintain a vibrant market of broad network plans. The super wealthy then will simply pay their own bills.

So the Democrats traded off our choice of physicians and hospitals for a choice of deductibles and copayments, as the insurers took away the choices that we actually wanted. The narrow and ultra-narrow networks were a decision of the insurers, not us. We are getting what they want rather than what we want, simply because the Affordable care Act was designed to leave the insurers in charge.

As we’ve said before, all of this would go away if only we would enact a single payer national health program. As PNHP president Andy Coates says, physicians are placed in an “ethical bind” as they practice under “a corporate medical model that threatens to squeeze the humanity out of our interaction with our patients.”