PNHP

Senate committee on single payer lessons for the U.S.

Senate committee on single payer lessons for the U.S.

Subcommittee Hearing – Access and Cost: What the US Health Care System Can Learn from Other Countries

Committee on Health, Education, Labor and Pensions (HELP) , Subcommittee on Primary Health and Aging
United States Senate, March 11, 2014

Statement by:
Tsung-Mei Cheng, LL.B., M.A.
Health Policy Research Analyst
Woodrow Wilson School of Public and International Affairs, Princeton University

Today’s hearing is focused on “international single payer health system models that provide universal coverage of health care.” I will tailor my remarks according to the three sub-themes the Committee wishes to explore, namely:

*  Primary care access in single payer systems

*  Health care costs in single payer systems, and

*  Cross-country comparisons of health outcomes

Before proceeding with the Committee’s agenda in more detail, however, I would like to provide the Committee with a summary of my main points:

1. If equity and social solidarity in access to health care and financing health care were fundamental goals of a health care system, the single payer system provides an ideal platform for achieving these goals.

2. Single-payer systems typically are financed by general- or payroll taxes in a way that tailors the individual’s or family’s contribution to health-care financing to their ability to pay, rather than to their health status, which until this year has long been the practice in the individual health insurance market in the U.S.

3. These systems protect individual households from financial ruin due to medical bills.

4. Single-payer health systems typically afford patients free choice of health-care provider, albeit at the expense of not having a freedom of choice among different health insurers. Remarkably, in the U.S. households have some freedom of choice of health insurers – to the extent their employer offers them choice – but most Americans are confined to networks of providers for their insurance policy. In other words, Americans appear to have traded freedom of choice among providers for the sake of choice among insurers.

5. In single-payer systems “money follows the patient.” Therefore providers of health care must and do compete for patients on the basis of quality and patient satisfaction, but not price.

6. In a single payer health insurance system, health insurance is fully portable from job to job and into unemployment status and retirement. The “job-lock” phenomenon prevalent in the US is unknown in those systems, contributing to labor-market efficiency.

7. Because all funds to providers of health care in a single-payer system flow from one payer, it is relatively easy to control total health spending in such systems. Indeed, total national health spending as a percent of GDP in countries with single-payer systems is lower than it tends to be in non-single-payer health systems. This does not mean providers are left without a voice. Provider inputs are part of the formal negotiations over health-care budgets.

8. For the most part, single-payer systems achieve their cost control by virtue of the monopsonistic market power they enjoy vis a vis providers of health care. It is a countervailing power that the highly fragmented U.S. health-insurance system lacks vis a vis providers.

9. As part of their effort to control total health spending, however, and to avoid the waste of excess capacity that easily develops in health care, some single-payer systems (the UK and Canada) put constraints on the physical capacity of their health system (number of inpatients beds, MRI scanners, etc). That approach can lead to rationing by the queue. The alternative to rationing by such administrative devices, of course, is rationing by price and ability to pay, an approach used by design or by default in the United States. Rationing by price or by non-price mechanism are just alternative forms of rationing.

10. A single-payer system is an ideal platform for a uniform electronic health information system of the sort, for example, used by our Veterans Administration health system (a single-payer system in its own right). There is a common nomenclature which enables 100% electronic billing and claims processing, thus yielding significant savings in administrative costs.

11. Because they conveniently capture information on all health-care transactions, single-payer systems provide a data base that can be used for quality measurement, monitoring and improvement, and also for more basic research on what drives health spending and what clinical treatments works and does not work in health care. It enables evidence based medicine and the tracking of efficacy and safety of new drugs and devices once they are introduced after approval by government based on results of clinical trials.

Statement of Tsung-Mei Cheng (28 pages):http://www.help.senate.gov/imo/media/doc/Cheng.pdf

Video of the hearing and links to statements of all participants:http://www.help.senate.gov//hearings/hearing/?id=8acab996-5056-a032-522e…

Sen. Bernie Sanders chaired a Senate committee hearing on what the health care system in the United States can learn from other countries. Tsung-Mei Cheng provided an excellent overview of single payer and of the sharp contrasts between the United States and other nations. Her 28 page statement is well worth downloading to use as an information resource in educating others about single payer.

Other informative presentations included those of Victor Rodwin on France, Ching-Chuan Yeh on Taiwan, Danielle Martin on Canada, and Jakob Kjellberg on Denmark. Even the presentations from the other side by Sally Pipes and David Hogberg were helpful in that they showed how silly (sadly) their views were when contrasted with a group of experts who understand well how systems based on solidarity work. If you can find the time, viewing the entire video (1 hour & 46 minutes) and reading the statements would be well worth the effort (link above).

If you don’t have the time, at least view this 4 minute YouTube video of clips from the hearing: https://www.youtube.com/watch?v=9WdqtPLRc1A

International experts tell senators that single-payer improves national health at less cost

By Mark Karlin
Truthout/Buzzflash, March 11, 2014

Here are two basic facts to remember about the health care system in the United States. First, there is the high cost, as noted in a 2012 report on PBS:

How much is good health care worth to you? $8,233 per year? That’s how much the U.S. spends per person.

Worth it?

That figure is more than two-and-a-half times more than most developed nations in the world, including relatively rich European countries like France, Sweden and the United Kingdom. On a more global scale, it means U.S. health care costs now eat up 17.6 percent of GDP….

Whether measured relative to its population or its economy, the United States spends by far the most in the world on health care.

The U.S. spent $8,233 on health per person in 2010. Norway, the Netherlands and Switzerland are the next highest spenders, but in the same year, they all spent at least $3,000 less per person. The average spending on health care among the other 33 developed OECD countries was $3,268 per person.

That statistic brings up the much-beloved free market criteria of return on investment (ROI), at which the US performs abysmally according to many studies when it comes to health. 

An NPR article in 2013 is entitled, “US Ranks Below 16 Other Rich Countries In Health Report”:

It’s no news that the U.S. has lower life expectancy and higher infant mortality than most high-income countries. But a … new report says Americans are actually less healthy across their entire life spans than citizens of 16 other wealthy nations.

And the gap is steadily widening.

“What struck us — and it was quite sobering — was the recurring trend in which the U.S. seems to be slipping behind other high-income countries,” the lead author of the report, Dr. Steven Woolf, tells Shots.

He says Americans of all ages up to 75 have shorter lives and more illness and injury.

It should be noted that in this report, the United States is being compared to other “developed” nations.  A recent United Nations Population Divison report ranked the US 40th in life expectancy among all nations in 2010.

In short, the US spends the most on medical care with poor life expectancy results, even including many nations that are not considered wealthy.

The Affordable Care Act (ACA) may have made insurance coverage more inclusive, but it keeps the insurance companies in charge of calling the shots (for those without Medicare, Veterans Care or Medicaid) and adding to the cost of health care through administrative costs and profit.

According to the advocacy organization Public Citizen, a number of experts from single-payer nations recently testified at a Senate sub-committee hearing chaired by Sen. Bernie Sanders (I-VT), a leading supporter of Medicare for all. The spokespersons from Canada and Denmark offered compelling reasons why the US should move from a private-insurance system to a government administered program (such as, well, Medicare):

For example, the Canadian witness, Dr. Danielle Martin, vice president of medical affairs and health system solutions at Women’s College Hospital, compared access to care, quality of care and costs in the U.S. and Canadian systems, and found all were superior in Canada. Martin compared the American average for administrative costs of 31 percent to the 1.3 percent administrative costs paid by Canada (not counting costs for private supplemental plans available to Canadians.) Professor Jakob Kjellberg from the Danish Institute for Local and Regional Government Research, who served as the Danish expert witness, said his country’s administrative costs are only 4.3 percent of total health care spending. 

In short, as has been argued before, private health insurance (which we still obviously have under the ACA) increases the cost of medical care, with nearly a third of that cost eaten up by private insurance non-health related revenue.  To repeat the testimony cited above: 31 percent of US health insurance costs goes to insurers, while in Canada only 1.3 percent of medical costs are administrative.

As far as access to care, to the contrary of what Sarah Palin infamously asserted — that government care would lead to death panels — it is private insurance companies who employ staff to decide whether medical care — sometimes a matter of life or death with chronic illnesses and rare diseases — should be provided.  Medicare does not employ “profit-increasers” to deny care.

Indeed, a spokesperson for Public Citizen pointedly summarized the hearing:

Today’s panel was a good first step that will hopefully inspire a real discussion about the benefits of single-payer health care in the United States, said Susan Harley, deputy director of Public Citizen’s Congress Watch division. A single-payer, or Medicare-for-all, system would eliminate health insurance companies from the equation, ensuring that only patients and their doctors make decisions about care options.

Although the ACA is to be praised for providing many uninsured people an opportunity to sleep with some peace of mind, it is still a rickety system constructed to ensure the political support of medical insurance companies.

US politicians, including President Obama, regularly boast about the US being the leader of the world in progress and a model for other nations.

Having the most expensive healthcare system, with the worst general outcome ranking for developed nations, looks like the US is a wobbly caboose not a powerful engine.

Medicare for all could solve that problem when it comes to cost-effectively fostering a healthy national population.

Afternote: The Daily Show, as usual, brought home the reality of the dysfunctional national US health care system in this recent segment. Click here.

Mark Karlin is editor of Buzzflash at Truthout.

http://www.truth-out.org/buzzflash/commentary/international-experts-tell-senators-that-single-payer-improves-national-health-at-less-cost

What the U.S. can learn about health care from other countries

PNHP note: The following press release was issued by the staff of Sen. Bernie Sanders of Vermont on March 11.

Other major countries offer better health care at less cost than the United States, according to witnesses who testified on Tuesday at a Senate hearing chaired by Sen. Bernie Sanders. “What this hearing is really about is two fundamental issues. First, the U.S., the wealthiest country on the planet, is the only major industrialized country in the world that does not guarantee health care as a right to its citizens. Should we consider joining the rest of the world? I’d argue we should,” Sanders said. “Second, the U.S. spends twice as much as other countries that have much better health outcomes. What can we learn from these countries?” asked Sanders, chairman of the Senate Subcommittee on Primary Health and Aging.

Citing World Health Organization data, Sanders said the U.S. spends as much as three times more on health care than other industrialized countries. Health care outlays in the U.S. account for about 18 percent of our Gross Domestic Product, significantly more than in France, Germany, Denmark, Canada, Great Britain, Australia, Norway, Taiwan and Israel.

In Denmark, “all citizens have access to care; no one may be denied services on the basis of income, age, health or employment status,” according to Jakob Kjellberg, an economist from Copenhagen. Victor Rodwin, an expert on the French health care system, said “the French have easy access to primary health care, as well as specialty services, at half the per capita costs of what we spend in the U.S.

Other witnesses said the money Americans sink into their expensive health care system does not buy better care. “Canada achieved health outcomes that are at least equal to those in the U.S. at two-thirds the cost,” according to one witness at the hearing, Dr. Danielle Martin of Women’s College Hospital in Toronto.

The United States ranks 26th in life expectancy compared to other countries ranked by the Paris-based Organization for Economic Cooperation and Development. People who live in Italy, Spain, France, Australia, Israel, Norway and other countries live 2 to 3 years longer than Americans.

The Affordable Care Act has improved access to insurance, but millions of Americans still lack insurance or have plans with such high deductibles and copayments that they cannot afford the care they need. As a result, some 45,000 uninsured Americans die each year because they didn’t go to a doctor in time.

A major factor driving up health care costs in the U.S. is the high cost of prescription drugs. Hospital stays also cost more. While hospitals in Germany and France charge $3,000 for an appendectomy, for example, the average price for the same procedure in American hospitals is $13,000. Some U.S. hospitals charge $28,000.

“It is time for the U.S. to join the rest of the industrialized world and guarantee access to health care as a right of all people, not just a privilege for those who can afford it,” Sanders said.

http://www.sanders.senate.gov/newsroom/recent-business/us-can-learn-other-countries-health-care

Testimony by international experts underscores benefits of single-payer health care systems

At congressional hearing, experts provide further evidence the U.S. should implement ‘Medicare for All’

By Public Citizen National Journal, March 11, 2014

WASHINGTON — Testimony given today by experts from Canada, Denmark, Taiwan and other countries underscores that single-payer health care systems remove the kind of hindrances to quality care that still plague the U.S., Public Citizen said today.

The witnesses provided compelling evidence to the members of the U.S. Senate Health, Education, Labor, and Pensions (HELP) Committee’s Subcommittee on Primary Health and Aging regarding the benefits of efficient, single-payer health care systems in their respective nations.

Citing cost savings and improved access to health care, expert witnesses explained to subcommittee members what’s been clear to Public Citizen for years: A Medicare-for-all, single-payer system would remove one of the main hurdles the U.S. faces in the quest to provide quality health care for everyone: high overall administrative charges from insurance companies.

For example, the Canadian witness, Dr. Danielle Martin, vice president of medical affairs and health system solutions at Women’s College Hospital, compared access to care, quality of care and costs in the U.S. and Canadian systems, and found all were superior in Canada. Martin compared the American average for administrative costs of 31 percent to the 1.3 percent administrative costs paid by Canada (not counting costs for private supplemental plans available to Canadians.) Professor Jakob Kjellberg from the Danish Institute for Local and Regional Government Research, who served as the Danish expert witness, said his country’s administrative costs are only 4.3 percent of total health care spending.

U.S. Sen. Bernie Sanders (I-Vt.), who chairs the subcommittee, is a longtime champion of single-payer health systems and introduced legislation late in 2013, the American Health Security Act of 2013 (S. 1782), to move the United States to a unified system of health care delivery. In addition, U.S. Rep. John Conyers (D-Mich.) has introduced single-payer legislation, the Expanded and Improved Medicare-For-All Act (H.R. 676).

Several witnesses discussed their countries’ goals of equity and how universal access to care was well-regarded by citizens. Dr. Ching-chuan Yeh of Taiwan, former health minister of Taiwan and professor at the School of Public Health, College of Medicine at Tzu Chi University, explained how the nation has achieved 99.6 percent coverage for the population and subsequently has seen increases in life expectancy and a drop in the infant mortality rate.

“Today’s panel was a good first step that will hopefully inspire a real discussion about the benefits of single-payer health care in the United States,” said Susan Harley, deputy director of Public Citizen’s Congress Watch division. “A single-payer, or Medicare-for-all, system would eliminate health insurance companies from the equation, ensuring that only patients and their doctors make decisions about care options.”

In addition to the national movement to adopt a single-payer health care system, state-based proposals have been put forward in several states (Vermont, New York, California, Pennsylvania, Minnesota, Hawaii and Colorado) that would require a single government payer for health care services instead of a patchwork of private and public health insurers. As explained by the subcommittee witnesses, such systems have a record of providing comprehensive, universal care at a significantly lower cost than we pay for the U.S.’s fragmented system, which leaves millions of people with no coverage.

“Public Citizen supports states moving toward single-payer systems and has outlined a road map for states to achieve the important goal of maximum coverage with minimum cost,” Harley said. “However, we need a national system that truly provides health care for all. We are encouraged by today’s hearing and look forward to a robust discussion about replicating the best of international models of single-payer here in the U.S.

http://www.nationaljournal.com/library/123291

UNITE HERE report on ACA and worsening inequality

The Irony of ObamaCare: Making Inequality Worse

UNITE HERE, March 7, 2014

The promise of Obamacare was the right one and the hope for extending healthcare coverage to the un- and under-insured a step in the right direction. Yet the unintended consequences will hit the average, hard-working American where it hurts: in the wallet. Currently a national dialogue is emerging by all political parties on the issue of income inequality. That is a debate worth having. The White House and Congressional Democrats are “resetting” the domestic agenda following the negative fallout from the rollout of the ACA. They plan to shift focus from health care to bread and butter issues of income inequality that have eroded the American paycheck for decades.

Ironically, the Administration’s own signature healthcare victory poses one of the most immediate challenges to redressing inequality. Yes, the Affordable Care Act will help many more Americans gain some health insurance coverage, a significant step forward for equality. At the same time, without smart fixes, the ACA threatens the middle class with higher premiums, loss of hours, and a shift to part-time work and less comprehensive coverage.

*  Transferring A Trillion Dollars in Wealth: Most of the ACA’s $965 billion in subsidies will go directly to commercial insurance companies, one of the largest transfers of public wealth to private hands ever. Since the ACA passed, the average stock price of the big for-profit health insurers doubled, their top executives were paid more than a half billion dollars in cash and stock options, and in the past 2 years, the top 10 insurers have spent $25 billion on mergers and acquisitions.

*  Strangling Fair Competition: Before reform, different types of health plans were regulated under different bodies of law. The Obama Administration has blocked many non-profit health funds from competing for the law’s proposed trillion dollars in subsidies by refusing to set fair regulations for different types of plans. The unbalanced playing field will give employers of people covered by these plans powerful incentives to drop coverage.

*  Moving to Part Time Work: The Administration’s experts say employers won’t follow the incentives and drop coverage. But they also told the nation that employers would not cut workers’ hours to get below the 30-hour per week threshold for “full time” work, even as 388 employers announced hours cuts since early 2012.

*  Cutting People’s Pay: If employers follow the incentives in the law, they will push families onto the exchanges to buy coverage. This will force low-wage service industry employees to spend $2.00, $3.00 or even $5.00 an hour of their pay to buy similar coverage.

Conclusion

For two years, labor unions and employer partners have patiently explained to the Obama Administration and Congress the potential damage that the ACA poses to these unique, successful non-profit health plans.

Having already made efforts to accommodate businesses, churches and congressional staff, it is ironic that the Administration is now highlighting issues of economic inequality without acting to preserve health plans that have been achieving the goals of the ACA for decades. Without a smart fix, the ACA will heighten the inequality that the Administration seeks to reduce.

We take seriously the promise that “if you like your health plan, you can keep it. Period.” UNITE HERE members like their health plans. UNITE HERE’s plans are ready to compete with the corporate giants of the health insurance industry if Washington will simply create a level playing field.

http://cdn.ralstonreports.com/sites/default/files/ObamaCaretoAFL_FINAL.pdf

Comment:

By Don McCanne

UNITE HERE is a union of service workers in hotels and other industries. Many of their members are insured through non-profit Taft-Hartley plans with joint union-management governance structures. This report shows how the Affordable Care Act can have a negative impact on the health care coverage and hours of employment of union members, in effect making inequality worse.

Some of their legitimate complaints:

*  Employers are not required to make available health insurance to employees who work less than 30 hours per week. Although the Obama administration denies that this will cause employers to reduce the hours that many of their employees work, it is already happening. Obviously that reduces the employees’ net incomes and may disqualify them from receiving insurance coverage.

*  Employers do not have to provide any health coverage at all if they do not have more than 50 employees. Many employers are taking measures to stay below the 50 full-time employee threshold.

*  Employer penalties for not providing coverage are far smaller than the employer costs of their health benefit programs. It is likely that many employers will elect to pay the penalties rather than support a health plan. Yet it is unlikely that employers will increase wages enough to compensate for the lack of an employee health benefit program.

*  Most UNITE HERE union members have wages low enough to qualify for subsidies to help pay for plans obtained through the state or federal insurance exchanges. Yet those subsidies cannot be used for employees in the UNITE HERE Taft-Hartley plans. (They do indirectly receive the tax benefit of deductibility for employer-sponsored plans, but at their income levels, this benefit may be negligible.)

*  More expensive plans will be subject to a 40 percent excise tax. The UNITE HERE Taft-Hartley plans may be subject to this tax, not because the benefits are too generous, but rather because health care costs are so high and because many of the employees in the service industry union are older with greater health care costs. This excise tax is borne by the employee through higher premiums and forgone wage increases.

*  All plans, including Taft-Hartley plans, pay taxes that are used to ease the financial transition of private plans offered on the exchanges. Though the union members ultimately pay these taxes, they receive none of the benefits since Taft-Hartley plans do not qualify for transitional financial support.

*  Self-funded plans, such as these Taft-Hartley plans, are prohibited from being offered to the public and thus cannot benefit from market competition as the exchange plans can.

*  ACA generously subsidizes private health plans with some of those funds going to overpaid executives and wealthy shareholders, thereby contributing to worsening inequality.

Although UNITE HERE calls for Congress and the president to level the playing field through legislation and rule making, a far better solution would be to establish a single payer national health program.

Under an improved Medicare for all, UNITE HERE union members would receive more generous benefits, with first dollar coverage, and with a net cost to them in taxes that would be significantly less than what they are currently paying in premiums and forgone wages. A single payer system would be more effective in reducing inequality than would tweaking the Taft-Hartley plans.

UNITE HERE report on ACA and worsening inequality

The Irony of ObamaCare: Making Inequality Worse

UNITE HERE, March 7, 2014

The promise of Obamacare was the right one and the hope for extending healthcare coverage to the un- and under-insured a step in the right direction. Yet the unintended consequences will hit the average, hard-working American where it hurts: in the wallet. Currently a national dialogue is emerging by all political parties on the issue of income inequality. That is a debate worth having. The White House and Congressional Democrats are “resetting” the domestic agenda following the negative fallout from the rollout of the ACA. They plan to shift focus from health care to bread and butter issues of income inequality that have eroded the American paycheck for decades.

Ironically, the Administration’s own signature healthcare victory poses one of the most immediate challenges to redressing inequality. Yes, the Affordable Care Act will help many more Americans gain some health insurance coverage, a significant step forward for equality. At the same time, without smart fixes, the ACA threatens the middle class with higher premiums, loss of hours, and a shift to part-time work and less comprehensive coverage.

*  Transferring A Trillion Dollars in Wealth: Most of the ACA’s $965 billion in subsidies will go directly to commercial insurance companies, one of the largest transfers of public wealth to private hands ever. Since the ACA passed, the average stock price of the big for-profit health insurers doubled, their top executives were paid more than a half billion dollars in cash and stock options, and in the past 2 years, the top 10 insurers have spent $25 billion on mergers and acquisitions.

*  Strangling Fair Competition: Before reform, different types of health plans were regulated under different bodies of law. The Obama Administration has blocked many non-profit health funds from competing for the law’s proposed trillion dollars in subsidies by refusing to set fair regulations for different types of plans. The unbalanced playing field will give employers of people covered by these plans powerful incentives to drop coverage.

*  Moving to Part Time Work: The Administration’s experts say employers won’t follow the incentives and drop coverage. But they also told the nation that employers would not cut workers’ hours to get below the 30-hour per week threshold for “full time” work, even as 388 employers announced hours cuts since early 2012.

*  Cutting People’s Pay: If employers follow the incentives in the law, they will push families onto the exchanges to buy coverage. This will force low-wage service industry employees to spend $2.00, $3.00 or even $5.00 an hour of their pay to buy similar coverage.

Conclusion

For two years, labor unions and employer partners have patiently explained to the Obama Administration and Congress the potential damage that the ACA poses to these unique, successful non-profit health plans.

Having already made efforts to accommodate businesses, churches and congressional staff, it is ironic that the Administration is now highlighting issues of economic inequality without acting to preserve health plans that have been achieving the goals of the ACA for decades. Without a smart fix, the ACA will heighten the inequality that the Administration seeks to reduce.

We take seriously the promise that “if you like your health plan, you can keep it. Period.” UNITE HERE members like their health plans. UNITE HERE’s plans are ready to compete with the corporate giants of the health insurance industry if Washington will simply create a level playing field.

http://cdn.ralstonreports.com/system/assets/drupal/ObamaCaretoAFL_FINAL.pdf

UNITE HERE is a union of service workers in hotels and other industries. Many of their members are insured through non-profit Taft-Hartley plans with joint union-management governance structures. This report shows how the Affordable Care Act can have a negative impact on the health care coverage and hours of employment of union members, in effect making inequality worse.

Some of their legitimate complaints:

*  Employers are not required to make available health insurance to employees who work less than 30 hours per week. Although the Obama administration denies that this will cause employers to reduce the hours that many of their employees work, it is already happening. Obviously that reduces the employees’ net incomes and may disqualify them from receiving insurance coverage.

*  Employers do not have to provide any health coverage at all if they do not have more than 50 employees. Many employers are taking measures to stay below the 50 full-time employee threshold.

*  Employer penalties for not providing coverage are far smaller than the employer costs of their health benefit programs. It is likely that many employers will elect to pay the penalties rather than support a health plan. Yet it is unlikely that employers will increase wages enough to compensate for the lack of an employee health benefit program.

*  Most UNITE HERE union members have wages low enough to qualify for subsidies to help pay for plans obtained through the state or federal insurance exchanges. Yet those subsidies cannot be used for employees in the UNITE HERE Taft-Hartley plans. (They do indirectly receive the tax benefit of deductibility for employer-sponsored plans, but at their income levels, this benefit may be negligible.)

*  More expensive plans will be subject to a 40 percent excise tax. The UNITE HERE Taft-Hartley plans may be subject to this tax, not because the benefits are too generous, but rather because health care costs are so high and because many of the employees in the service industry union are older with greater health care costs. This excise tax is borne by the employee through higher premiums and forgone wage increases.

*  All plans, including Taft-Hartley plans, pay taxes that are used to ease the financial transition of private plans offered on the exchanges. Though the union members ultimately pay these taxes, they receive none of the benefits since Taft-Hartley plans do not qualify for transitional financial support.

*  Self-funded plans, such as these Taft-Hartley plans, are prohibited from being offered to the public and thus cannot benefit from market competition as the exchange plans can.

*  ACA generously subsidizes private health plans with some of those funds going to overpaid executives and wealthy shareholders, thereby contributing to worsening inequality.

Although UNITE HERE calls for Congress and the president to level the playing field through legislation and rule making, a far better solution would be to establish a single payer national health program.

Under an improved Medicare for all, UNITE HERE union members would receive more generous benefits, with first dollar coverage, and with a net cost to them in taxes that would be significantly less than what they are currently paying in premiums and forgone wages. A single payer system would be more effective in reducing inequality than would tweaking the Taft-Hartley plans.

Maine Medical Association survey shows 64 percent support single payer

Membership survey shows strong support for a Medicare for All, single-payer approach to reform

By the editors
Maine Medicine Weekly Update, March 10, 2014

A recent survey of Maine Medical Association (MMA) members showed an increase in the percentage of members supporting a single-payer approach to health system reform. The survey, completed by more than 450 respondents, included the following question:

“When considering the topic of health care reform, would you prefer to make improvements to the current public/private system or a single-payer system such as a ‘Medicare for all’ approach?”

Sixty-four and three-tenths percent (64.3%) of respondents indicated that they preferred the single-payer option compared to the alternative “Improvements to the current public/private system,” which garnered support from 35.7% of those respondents who answered the question. The nearly two-thirds who indicated the single-payer preference represents an increase from the previous membership survey in 2008, in which just over half (52.3%) indicated preference for the single-payer option while 47.7% preferred improvements to the current system.

The question presented was worded precisely the same in each of the surveys.

In the recent survey, conducted in January, there was little to no difference in response to the question based upon age, geographic location, or MMA membership status. There was, however, a significant difference based upon specialty, with primary care physicians and psychiatrists tending to more heavily favor the single-payer option than physicians in other medical specialties. Respondents from practices that were owned by the physicians themselves were less likely to prefer the single-payer option and more likely to prefer improving the current system.  

The survey had a total of 462 respondents of whom 85% were physicians and 15% were medical students. 87% of the respondents were MMA members. The respondents make up approximately 13% of MMA members. The survey was conducted by Crescendo Consulting Group in Portland on behalf of MMA as part of the Payment Reform grant awarded by the Maine Health Access Foundation. The survey was also requested by a group of members who presented a Resolution at the 2013 Annual Meeting asking for the survey to be updated from 2008.

More details of the survey will be placed on the Association’s website at www.mainemed.com by the end of this week.

While the survey demonstrates strong support for a single-payer system by those members who responded to the survey, MMA’s formal policy position on health system reform, developed originally in 2003 and updated in 2010, is in support of universal coverage for all Mainers to be achieved through a combination of public and private health plans.

Physicians For A National Health Program Have Organizational Meeting

The Chattanoogan, March 7, 2014

An organizational meeting for a new Southeast Tennessee chapter of Physicians for a National Health Program was held Thursday evening at Foodworks.  

Founded in 1987, PNHP believes that access to high-quality health care is a right of all people and should be provided equitably as a public service rather than bought and sold as a commodity. It advocates for a universal, comprehensive single-payer national health program and has more than 19,000 members and chapters across the U.S.

Attendees included a physician-in-training, medical educators, and practicing and senior physicians. They discussed organizational matters, future meetings and the development of a speaker’s bureau for local presentations.  

More information about PNHP, including resources supporting the need for a national health program, can be obtained at www.pnhp.org.  For local information, contact Dr. Laura Helfman at riverdoc@blomand.net.

http://www.chattanoogan.com/2014/3/7/271307/Physicians-For-A-National-Health.aspx

ACA won’t control health care costs

By Henry J. Waters III
Columbia (Mo.) Daily Tribune, March 8, 2014

Recently a group of physicians sponsored a visit by a University of Massachusetts professor of economics who goes about the country touting the advantages of single-payer health care, using numbers as his forte. Gerald Friedman appeared at the University of Missouri School of Medicine at the behest of the Missouri chapter of the Physicians for a National Health Program.

His thesis: the Affordable Care Act, otherwise known as Obamacare, does a lot of good things but does not control costs. The answer is a single-payer system in which the government acts as insurer.

I have made the same argument here based on the obvious premise health insurance can operate most efficiently and inexpensively only if the risk pool includes the entire population. We are seeing problems inherent in the hybrid ACA approach. For political reasons, elements of the old system are being preserved while tomorrow’s fix is held at bay.

We know the better model. Often referred to as Medicare for all, the best new system will operate like the familiar and popular Medicare system, expanded to include people of all ages and means.

Models in other nations show continuing roles for private insurance companies but not as designers of universal coverage. Indeed, universal coverage is contrary to the economic principles of private health insurance, which profits by maximizing revenue and minimizing costs. The role of government in a national health system is the opposite, resulting in more effective care at lower overall cost, which Friedman regards as a hugely important economic boon.

In years past, physicians and other health care providers have not wanted to lose the fee-for-service system, but growing numbers now look forward to a more rational system. They are tired of private insurance hassles and recognize fee-for-service to put profit over best-care practices. Of course, they should be well compensated, but with a nationally managed system, providers can be incentivized to emphasize wellness and health outcomes rather than proliferation of services and procedures.

As Friedman points out, the substantial money saved in a single-payer system can go back into the economy. Health care costs can be reduced by billions. He cited numerous examples of lower costs and superior health outcomes in other countries.

“Get the profit out of health care, and everybody wins,” he says.

Well, not everybody. Sellers of insurance, drugs and other health care products and services have profited through the years with the disappearing system. You can’t blame them for working the territory and wanting the status quo to last, but by now evidence is clear the United States should join the other developed countries of the world with a better system. Examples are everywhere, including in our own country.

Let’s call it Medicare if we don’t like “single-payer,” but let’s get on with it.

Henry J. Waters III is editor at the Columbia Daily Tribune.

http://www.columbiatribune.com/opinion/the_tribunes_view/aca/article_d1a23bf0-a679-11e3-8c21-10604b9f6eda.html?comments=focus

Lawmaker who supports private health insurance should look into single-payer system

By Bob Balhiser
The Missoulian (Mont.), Letters, March 9, 2014

I was amused to read Joe Balyeat’s (March 3) guest column explaining why Obamacare is doomed to fail. He attempts to make his point by extolling the virtues of private health insurers who, as I see it, are largely responsible for the fact that Americans pay the highest costs for health care of any developed country in the world.

The fact is that we in the U.S. pay about 18 percent of our Gross Domestic Product for health-related costs, while all other advanced countries pay an average of 11 percent GDP. Put another way, that 7 percent difference in GDP in our economy amounts to nearly $1 trillion in annual costs that go to parasites in our health care system. Two of the most egregious of these parasites are the private health insurers that Balyeat defends, and big pharmaceutical companies; trial lawyers also push up system expenses by forcing doctors to practice costly defensive medicine.

Few developed countries are saddled with private health insurers, but those that are have tightly controlled and regulated systems that force insurers to compete aggressively with one another for customers. Many other developed countries have some variation of “single payer” systems that would be a lot like having Medicare For All. Americans could save about $ 1 trillion ($1,000,000,000,000) annually in health care costs with Medicare For All.

I’d like to see Balyeat consider these facts and explain why a “single payer” system would not be far better and more economical than one that relies on the private health insurers he seems to so admire.

Bob Balhiser resides in Helena.

When Health Costs Harm Your Credit

By Elisabeth Rosenthal
The New York Times, March 8, 2014

Like most people, I am generally vigilant about paying my bills — credit cards, mortgage, cellphone and so on. But medical bills have a different trajectory. I (usually) open the envelopes and peruse the amalgam of codes and charges. I sigh or swear. And set them aside for when I have time to clarify the confusion: An out-of-network charge from a doctor I know is in-network? An un-itemized laboratory bill from a doctor I’ve never heard of? A bill for a huge charge before my insurer has paid its yet unknown portion of a hospital’s unknowable fee?

I would never countenance the phrase “60 days past due” on my Visa card statement. But medical bills? Well… with the complex negotiations that determine my ultimate payment, it often takes months to understand what I actually owe.

Unfortunately, I may be playing a dangerous game. Mounting evidence shows that chaos in medical billing is not just affecting our health care but dinging the financial reputation of many Americans: While the bills themselves frequently take months to sort out, medical debts can be reported rapidly to credit agencies, and often without notification. And even small unpaid bills can severely damage credit ratings.

A mortgage initiator in Texas, Rodney Anderson of Supreme Lending, recently looked at the credit records of 5,000 applicants and found that 40 percent had medical debt in collection, with the average around $400; even worse, most applicants were unaware of their debt. Richard Cordray, director of the federal Consumer Financial Protection Bureau, has noted that half of all accounts reported by collection agencies now come from medical bills, and the credit record of one in five Americans is affected.

A single medical bill reported to a credit agency can easily become a “millstone around your neck” said Mark Rukavina, principal at Community Health Advisors, a health care advisory service. He added: “It will take a long time to make that right, even once the bill is paid. I’ve had mortgage brokers call me and say ‘I have these people with great credit. They’ve refinanced before, but now they’ve got this medical bill and even though they’ve paid it off, I can’t get them a good rate.’ ”

Part of the problem is that there are few standards governing medical debts: One billing office might give you — or your insurer — 60 days to pay before pursuing collection. Another might allow you to pay off a bill slowly over a year. Many will sell the debt to collection companies, which typically take a cut of the proceeds and decide when or whether to report unpaid debt to credit agencies.

The problem is accelerating for several reasons. Charges are rising. Insurance policies are requiring more patient outlays in the form of higher deductibles and co-payments. More important, perhaps, is that while doctors’ practices traditionally worked out deals for patients who had trouble paying, today many doctors work for large professionally managed groups and hospital systems whose bills are generated far away, by computer.

Both Congress and the protection bureau have been trying to better insulate patient credit scores from the inefficiencies of our market-based medical system. Various proposals have been considered to differentiate medical debt from other forms; it could be erased once it has been paid off or not reported to credit agencies at all, for example. So far, the credit industry has fought successfully against such efforts, noting that they could allow some genuine scofflaws to evade legitimate charges. But it’s also good business, since health care bills are now the largest source of business for collection companies, according to consumer protection agency officials.

Having spent the last year reporting a series on American health costs, I’ve heard plenty about credit casualties.

Gene Cavallo, 61, a New Mexico businessman who put his children through college, had always paid his bills promptly and had an excellent credit rating, until he required surgical excision of a melanoma on his shin two years ago. The more than 60 bills generated for the surgery and six months of follow-up visits — arriving sporadically and ranging from 18 cents to $17,000 — came to $110,000; his insurance covered about $70,000.

When various providers asked him to pay the remaining $40,000, he requested itemized bills and balked at some of the “ridiculously inflated prices,” such as $85 for tweezers and $20 for a box of tissues. He argued the bills point by point, and ultimately agreed to pay $25,000.

But during the negotiations some of the debt was sent to collection. Two years later, he no longer answers the daily robocalls from collection agencies and has had a couple of credit cards canceled because his score has fallen. “It was a scary thing to do because I own a business and dabble in real estate, so the ability to borrow has always been important to me. And now I have no ability, I assume, to borrow for any reason.”

Michael S., who declined to give his full name so as to protect his reputation with business clients, had to declare bankruptcy in Wisconsin more than five years ago after a fraught year in which his toddler was evaluated for what proved to be a benign neurological condition that required no treatment: “You’d get bills for several different doctors’ groups and for tests and M.R.I.s and you don’t know what they are. I was having trouble figuring out who we owed what. And then, if it goes to collection, then suddenly they’re saying we need this paid now.”

With medical expenses, unlike most other purchases, you generally don’t know the price the hospital will charge in advance. And the subsequent bills and insurance statements — so-called explanations of benefits — are often layered in obfuscation and pressure tactics.

Consider Chris Sullivan of Pennsylvania, whose $2,770 bill for an echocardiogram offered a “prompt payment” discount of 20 percent if he wrote a check within 21 days — meaning a discount for not asking questions on a bill for a test he was told would be under $300.

Another “explanation of benefits” statement notified Joe Cotugno of New York City that his two-day hospital stay for a hip replacement was billed at $99,469.70 (doctors’ fees not included). Cigna paid $68,420.53 after knocking off some $28,000 and requiring Mr. Cotugno to pay $3,018.41. So, it informed him, “You saved 96 percent.” Huh?

The Consumer Financial Protection Bureau has been studying the impact of medical billing on credit scores since 2012, acknowledging that unpaid medical bills in collection “frequently end up on consumer credit reports,” as an outgrowth of “very complex and confusing systems of figuring out who owes what after a medical procedure.” Mr. Cordray, the bureau’s director, said it would take appropriate action if harmful practices were identified.

Bills in Congress that would regulate the practices have been stalled for years. The Medical Debt Relief Act was passed by the House in 2010, but never made it to a Senate vote. After a modified version of the bill failed to pass again last year, another act was recently introduced in the Senate and House.

Meanwhile, patients are right to worry. When Matt Meyer, who owns a saddle-fitting company in New Hampshire, set up a monthly payment plan after some surgery, he was distressed to notice that the invoices came from a debt collector. “I had no idea this was considered debt,” he said, and wondered: “Are they reporting that” to a credit agency?

Good question.

Elisabeth Rosenthal is a reporter for The New York Times who is writing a series about the cost of health care, “Paying Till It Hurts.”

Medical bills and credit reports

When Health Costs Harm Your Credit

By Elisabeth Rosenthal
The New York Times, March 8, 2014

Mounting evidence shows that chaos in medical billing is not just affecting our health care but dinging the financial reputation of many Americans: While the bills themselves frequently take months to sort out, medical debts can be reported rapidly to credit agencies, and often without notification. And even small unpaid bills can severely damage credit ratings.

A mortgage initiator in Texas, Rodney Anderson of Supreme Lending, recently looked at the credit records of 5,000 applicants and found that 40 percent had medical debt in collection, with the average around $400; even worse, most applicants were unaware of their debt. Richard Cordray, director of the federal Consumer Financial Protection Bureau, has noted that half of all accounts reported by collection agencies now come from medical bills, and the credit record of one in five Americans is affected.

The problem is accelerating for several reasons. Charges are rising. Insurance policies are requiring more patient outlays in the form of higher deductibles and co-payments. More important, perhaps, is that while doctors’ practices traditionally worked out deals for patients who had trouble paying, today many doctors work for large professionally managed groups and hospital systems whose bills are generated far away, by computer.

Comment:

By Don McCanne

Our fragmented, dysfunctional system of paying medical bills is having a major impact on personal credit ratings. Half of all accounts reported by collection agencies now come from medical bills. The credit record of one-fifth of Americans is affected, and many of us are unaware of it. Are people so broke that they can’t pay their medical bills, or is something else going on here?

There are two major factors at play here. One is that with flat wages and increasing household costs, many people do have problems paying all of their essential bills, and medical bills are moved to the bottom of the stack. When payment of medical bills is postponed, or perhaps not paid at all, they are commonly sent to collection agencies, eventually appearing on the debtor’s credit report. Now that high deductibles are being used more to shift costs from payers (employers or government) to patients, this phenomenon is much more common.

The other factor is how people with good incomes who are meticulous with management of their personal finances end up with dinged credit reports because of medical bills. It is often due to the administrative complexity of the system we have of paying medical bills through private insurers who make payments based on whether the providers are in or out of network, on whether or not the products or services being billed are even covered by the plans, and on how much the deductible and coinsurance are and what charges can be credited against the deductible.

Typically the individual receives an explanation of benefits which is difficult to decipher often because some of these questions still remain unanswered. Billings may start to come in from various health care providers but without adequate explanation. When the patient inquires as to why the amount was not applied to the deductible, or why the amount seems to be for out-of-network providers when this provider is in-network, or for whatever  reason, the patient is often given a temporizing response. When more statements are received that failed to address concerns such as the deductible, further efforts to correct the problem are often met with reassurance. When nothing further is heard, the patient assumes the matter was cleared up. Only later when a collection agency begins to harass them or when they find their credit report includes unpaid medical bills do they discover that the matter never was resolved.

Add in further complexities such as when a person has primary coverage perhaps through Medicare and secondary coverage through a Medigap plan, or a person had a change in coverage coinciding with the medical services provided, straightening out who is responsible for which portions of the charges can be a monumental task.

These highly responsible individuals with previously excellent credit records are understandably angry. They tend to look elsewhere for blame – the physician’s office or billing service, the hospital’s billing department, the insurer’s claim processors, the credit agency’s disregard of registered protests, or perhaps the employer who provided such a screwed up health plan.

Single payer advocates know where most of the blame really lies. It is with our political leaders who insist on perpetuating this highly inefficient, fragmented system of financing health care instead of enacting a single payer national health program. This botched up system of medical billing is only one manifestation of the profound administrative excesses that permeate our system. Ironically, all of this extra administrative detail in handling medical billings doesn’t even work well. You would think that if we are going to be paying much more in administrative costs so that the insurers could do a “better” job than a single government payer in handling our claims, we would be demanding much better performance from them. But no, keep the government out and blame everyone else.

In typical D.C. fashion, our legislators continue to look for solutions that would increase regulatory oversight to prevent unfair damage to the credit ratings of conscientious individuals, though the legislators are receiving expected push back from the credit industry. What we do not need is more administrative oversight piled on top of an administrative boondoggle. Instead we need to replace it with an efficient improved Medicare, with first dollar coverage, that covers everyone. Credit scores dinged by medical bills then would become a quaint historical oddity.

Medical bills and credit reports

When Health Costs Harm Your Credit

By Elisabeth Rosenthal
The New York Times, March 8, 2014

Mounting evidence shows that chaos in medical billing is not just affecting our health care but dinging the financial reputation of many Americans: While the bills themselves frequently take months to sort out, medical debts can be reported rapidly to credit agencies, and often without notification. And even small unpaid bills can severely damage credit ratings.

A mortgage initiator in Texas, Rodney Anderson of Supreme Lending, recently looked at the credit records of 5,000 applicants and found that 40 percent had medical debt in collection, with the average around $400; even worse, most applicants were unaware of their debt. Richard Cordray, director of the federal Consumer Financial Protection Bureau, has noted that half of all accounts reported by collection agencies now come from medical bills, and the credit record of one in five Americans is affected.

The problem is accelerating for several reasons. Charges are rising. Insurance policies are requiring more patient outlays in the form of higher deductibles and co-payments. More important, perhaps, is that while doctors’ practices traditionally worked out deals for patients who had trouble paying, today many doctors work for large professionally managed groups and hospital systems whose bills are generated far away, by computer.

http://www.nytimes.com/2014/03/09/sunday-review/when-health-costs-harm-y…

Our fragmented, dysfunctional system of paying medical bills is having a major impact on personal credit ratings. Half of all accounts reported by collection agencies now come from medical bills. The credit record of one-fifth of Americans is affected, and many of us are unaware of it. Are people so broke that they can’t pay their medical bills, or is something else going on here?

There are two major factors at play here. One is that with flat wages and increasing household costs, many people do have problems paying all of their essential bills, and medical bills are moved to the bottom of the stack. When payment of medical bills is postponed, or perhaps not paid at all, they are commonly sent to collection agencies, eventually appearing on the debtor’s credit report. Now that high deductibles are being used more to shift costs from payers (employers or government) to patients, this phenomenon is much more common.

The other factor is how people with good incomes who are meticulous with management of their personal finances end up with dinged credit reports because of medical bills. It is often due to the administrative complexity of the system we have of paying medical bills through private insurers who make payments based on whether the providers are in or out of network, on whether or not the products or services being billed are even covered by the plans, and on how much the deductible and coinsurance are and what charges can be credited against the deductible.

Typically the individual receives an explanation of benefits which is difficult to decipher often because some of these questions still remain unanswered. Billings may start to come in from various health care providers but without adequate explanation. When the patient inquires as to why the amount was not applied to the deductible, or why the amount seems to be for out-of-network providers when this provider is in-network, or for whatever  reason, the patient is often given a temporizing response. When more statements are received that failed to address concerns such as the deductible, further efforts to correct the problem are often met with reassurance. When nothing further is heard, the patient assumes the matter was cleared up. Only later when a collection agency begins to harass them or when they find their credit report includes unpaid medical bills do they discover that the matter never was resolved.

Add in further complexities such as when a person has primary coverage perhaps through Medicare and secondary coverage through a Medigap plan, or a person had a change in coverage coinciding with the medical services provided, straightening out who is responsible for which portions of the charges can be a monumental task.

These highly responsible individuals with previously excellent credit records are understandably angry. They tend to look elsewhere for blame – the physician’s office or billing service, the hospital’s billing department, the insurer’s claim processors, the credit agency’s disregard of registered protests, or perhaps the employer who provided such a screwed up health plan.

Single payer advocates know where most of the blame really lies. It is with our political leaders who insist on perpetuating this highly inefficient, fragmented system of financing health care instead of enacting a single payer national health program. This botched up system of medical billing is only one manifestation of the profound administrative excesses that permeate our system. Ironically, all of this extra administrative detail in handling medical billings doesn’t even work well. You would think that if we are going to be paying much more in administrative costs so that the insurers could do a “better” job than a single government payer in handling our claims, we would be demanding much better performance from them. But no, keep the government out and blame everyone else.

In typical D.C. fashion, our legislators continue to look for solutions that would increase regulatory oversight to prevent unfair damage to the credit ratings of conscientious individuals, though the legislators are receiving expected push back from the credit industry. What we do not need is more administrative oversight piled on top of an administrative boondoggle. Instead we need to replace it with an efficient improved Medicare, with first dollar coverage, that covers everyone. Credit scores dinged by medical bills then would become a quaint historical oddity.