PNHP

Adults Give US Healthcare Cs and Ds

Adults Give US Healthcare Cs and Ds

Summary: A national poll of US adults yields terrible scores for our healthcare system: more “poor” and “fail” marks than “excellent” and “good”. The Gallup organization calls these Cs and Ds, but that’s a generous interpretation – we’re failing. We need a total do-over, adopting methods proven in other wealthy nations.

Majorities Rate Cost, Equity of U.S. Healthcare Negatively, Gallup News – Politics, October 6, 2022, by Nicole Willcoxon

Comment:

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

Yowzah. That’s massive under-performance. Only 21% of US adults think our healthcare system grade is good or excellent. Only 7% for costs, 22% for equity, and 31% for access. Quality of care scores highest – 47% say it’s good or excellent. But what is quality without access?

Sad, but not surprising. Indeed, we’ve performed at the bottom of wealthy countries for a long time. See HJM on the latest Commonwealth comparison here, and cross-national satisfaction surveys here and here.

If only we had better examples of how to pay for healthcare. If we could find, somewhere in the world, places that spend less while faring much better on access and outcomes. Oh, wait, all those countries that do better, they also cost a lot less.

Sorry I’m dripping with sarcasm today. It’s SO frustrating that we don’t learn our lesson. To paraphrase Winston Churchill, “Americans always do the right thing, after first trying everything else.” Well, we’ve tried everything else. Time to do the right thing – single payer!

http://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Medicare for All Explained Podcast: Episode 87

The Illogic and Fraud of Medicare Advantage Plans

October 15, 2022

Podcast host Joe Sparks points out the fundamental flaws of Medicare Advantage, a program that allows commercial health insurance to administer Medicare benefits.

“Medicare Advantage plans want to maximize profits,” he says, pointing to a recent bombshell report in The New York Times. “They and don’t care about the people they insure.”

Additional episodes will be uploaded twice monthly. Subscribe in iTunes, or access a complete archive of the podcast, below.

https://medicareforallexplained.podbean.com

Dr. Susan Rogers on “Healthcare-NOW”

PNHP president Dr. Susan Rogers appeared on the “Healthcare-NOW” podcast on October 12, 2022. Dr. Rogers discussed the lure of privately administered Medicare Advantage plans, which offer lower premiums to seniors, but can prove costly in the long-run when it comes to copays and outright denial of care.

“I’m not an MBA, but I know that if I spend more money than I bring in, [then] I have to change something,” said Dr. Rogers in reference to the high administrative costs that are another hallmark of Medicare Advantage. “What they’ve changed is not providing care.”

False Fixes for Administrative Bloat in US Health Care

Summary: Health Affairs did a very credible review of administrative excess in US health care, and a review of “targeted” reforms within the current system. Most optimistically, they would save a few billion dollars of the hundreds of billions in waste that single payer would eliminate.

The Role of Administrative Waste in Excess US Health Spending, Health Affairs Research Brief, October 6, 2022, by Health Affairs Staff

The US Spends More on Health Care Administration than Comparable Countries

One estimate from the Peterson Foundation, based on 2021 data from the OECD, finds that the US spends $1,055 per capita on administrative costs—by far the highest amount on a list of twelve OECD nations plus the US. The country with the next highest level of per capita administrative spending is Germany, at $306 per capita.

At least Half of Administrative Spending Is Wasteful

If administrative spending is about 15–30 percent of national health spending, then wasteful administrative spending comprises half of that, or 7.5–15 percent of national health spending (or $285–$570 billion in 2019).

Systemic Health Care Reforms Can Reduce Administrative Waste

Three main systemic reforms have the potential to not only reduce administrative waste but also offer other benefits to the health care system: all-payer rate setting, single-payer systems, and capitation.

Although these systemic reforms have the potential to reduce wasteful administrative spending, the targeted reforms discussed below are likely to be more realistic and actionable in the US in the near future.

  • Centralized Claims Clearinghouse (Cutler estimates that $300 million (NB not billion!) could be saved annually)
  • Standardized Or Limited Prior Authorization (CAHQ estimates that $417 million could be saved annually by switching to a fully electronic prior authorization system)
  • Harmonized Quality Reporting (Cutler suggests that an improved quality measurement system could save up to $7 billion annually)
  • Standardization Of Benefits (There is a lack of clear evidence that such standardization leads to administrative savings)
  • Standardization Of Provider Directories and Credentialing (Nationally, using a standardized platform for maintaining provider directories could save more than $1.1 billion per year, according to CAQH research)

Comment:

By Don McCanne, M.D.

The failure of our fragmented and dysfunctional health care financing system to provide health care for everyone along with financial security has been a driving force behind the call to enact and implement a humane, rational financing system such as single payer.

Although the political barriers are great, various incremental measures have been implemented with less than sterling results. Numerous studies have shown the profound administrative waste in our system which would be dramatically reduced by single payer. But the political resistance has been too great.

Now a leader in health policy – Health Affairs – is suggesting that, instead of systemic reform, we consider targeted reforms that are listed above. Two problems: If all of them were implemented, highly unlikely, the evidence for their effectiveness is missing. Never tested, conjectural. And, even if achieving the targets, the savings would constitute only a small fraction of the hundreds of billions we are spending on administration that we currently consider wasteful.

Worse, we would leave in place all of the injustices in health care access and in financial hardship due to lack of affordability of care. Also, nothing would have been done to reverse the massive private sector fraud and other waste exemplified by the recent New York Times expose on Medicare Advantage.

I don’t want to squander more space on trying to understand why Health Affairs isn’t supporting effective reform. Instead, I just want to climb up to the mountaintop and shout out: SINGLE PAYER!

Please feel free to join me.

http://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Medicare Advantage is a “Cash Monster” Absconding with Billions

Summary: The New York Times published a well-researched, clearly-presented, and hard-hitting article about the Medicare Advantage diagnostic upcoding money machine. This superb reporting translates for the public what analysts and reform advocates have warned about for years.

‘The Cash Monster Was Insatiable’: How Insurers Exploited Medicare for Billions, New York Times, October 8, 2022, by Reed Abelson and Margot Sanger-Katz

(bolding by HJM)

The health system Kaiser Permanente called doctors in during lunch and after work and urged them to add additional illnesses to the medical records of patients they hadn’t seen in weeks. Doctors who found enough new diagnoses could earn bottles of Champagne, or a bonus in their paycheck.

Anthem, a large insurer now called Elevance Health, paid more to doctors who said their patients were sicker. And executives at UnitedHealth Group, the country’s largest insurer, told their workers to mine old medical records for more illnesses — and when they couldn’t find enough, sent them back to try again.

Each of the strategies — which were described by the Justice Department in lawsuits against the companies — led to diagnoses of serious diseases that might have never existed. But the diagnoses had a lucrative side effect: They let the insurers collect more money from the federal government’s Medicare Advantage program….

[A] New York Times review of dozens of fraud lawsuits, inspector general audits and investigations by watchdogs shows how major health insurers exploited the program to inflate their profits by billions of dollars….

Eight of the 10 biggest Medicare Advantage insurers — representing more than two-thirds of the market — have submitted inflated bills, according to the federal audits. And four of the five largest players — UnitedHealth, Humana, Elevance and Kaiser — have faced federal lawsuits alleging that efforts to overdiagnose their customers crossed the line into fraud. … The fifth company, CVS Health, which owns Aetna, told investors its practices were being investigated by the Department of Justice. …

The additional diagnoses led to $12 billion in overpayments in 2020, according to an estimate from the group that advises Medicare on payment policies — enough to cover hearing and vision care for every American over 65.

Another estimate, from a former top government health official, suggested the overpayments in 2020 were double that, more than $25 billion.

The increased privatization has come as Medicare’s finances have been strained by the aging of baby boomers. But for insurers that already dominate health care for workers, the program is strikingly lucrative: A study from the Kaiser Family Foundation, a research group unaffiliated with the insurer Kaiser, found the companies typically earn twice as much gross profit from their Medicare Advantage plans as from other types of insurance. …

[R]egulators overseeing the plans at the Centers for Medicare and Medicaid Services, or C.M.S., have been less aggressive, even as the overpayments have been described in inspector general investigations, academic research, Government Accountability Office studies, MedPAC reports and numerous news articles, over the course of four presidential administrations.

Congress gave the agency the power to reduce the insurers’ rates in response to evidence of systematic overbilling, but C.M.S. has never chosen to do so. A regulation proposed in the Trump administration to force the plans to refund the government for more of the incorrect payments has not been finalized four years later. Several top officials have swapped jobs between the industry and the agency.

Comment:

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

This is remarkable reporting. The NYT nailed it: Medicare Advantage is a cash monster focused on maximizing revenue and profits regardless of the impact on beneficiary access to care. See our bolding for key points. A few elaborations:

  1. The problem is partly fraud. There’s plenty of that.
  2. The full extent of the cash extraction from Medicare is due to both legal and fraudulent diagnostic upcoding, and critically the failure of CMS to exercise its regulatory authority to correct for this upcoding.
  3. The projected excess payments to Medicare Advantage is $600 billion over ten years.
  4. This doesn’t even include cherry picking and lemon dropping, which contribute substantially to the differences in risk and money extraction.
  5. As noted in the article, private insurer profits are much higher with Medicare than in the private sector. And, as shown in HJM, the actual (de-facto) profit returns are obscenely high, 30% or more.

What’s most remarkable about this reporting isn’t the content. That’s terrific, accurate and powerful. What’s most remarkable is the placement: on the front page of the New York Times (for NYT old-timers, “above the fold”). Premier attention to this critical issue. As I can tell from my email and twitter traffic, rapid widespread sharing.

Let’s hope this represents a sea change in how the public understands and reacts to the private insurance takeover of Medicare Advantage, of Medicaid, and – with ACO REACH – traditional Medicare.

We need a health care financing system that elevates patients over profits. Single payer.

http://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

‘The Cash Monster Was Insatiable’: How Insurers Exploited Medicare for Billions

By next year, half of Medicare beneficiaries will have a private Medicare Advantage plan. Most large insurers in the program have been accused in court of fraud.

By Reed Abelson and Margot Sanger-Katz
The New York Times, October 8, 2022

The health system Kaiser Permanente called doctors in during lunch and after work and urged them to add additional illnesses to the medical records of patients they hadn’t seen in weeks. Doctors who found enough new diagnoses could earn bottles of Champagne, or a bonus in their paycheck.

Anthem, a large insurer now called Elevance Health, paid more to doctors who said their patients were sicker. And executives at UnitedHealth Group, the country’s largest insurer, told their workers to mine old medical records for more illnesses — and when they couldn’t find enough, sent them back to try again.

Each of the strategies — which were described by the Justice Department in lawsuits against the companies — led to diagnoses of serious diseases that might have never existed. But the diagnoses had a lucrative side effect: They let the insurers collect more money from the federal government’s Medicare Advantage program.

Medicare Advantage, a private-sector alternative to traditional Medicare, was designed by Congress two decades ago to encourage health insurers to find innovative ways to provide better care at lower cost. If trends hold, by next year, more than half of Medicare recipients will be in a private plan.

But a New York Times review of dozens of fraud lawsuits, inspector general audits and investigations by watchdogs shows how major health insurers exploited the program to inflate their profits by billions of dollars.

The government pays Medicare Advantage insurers a set amount for each person who enrolls, with higher rates for sicker patients. And the insurers, among the largest and most prosperous American companies, have developed elaborate systems to make their patients appear as sick as possible, often without providing additional treatment, according to the lawsuits.

As a result, a program devised to help lower health care spending has instead become substantially more costly than the traditional government program it was meant to improve.

Eight of the 10 biggest Medicare Advantage insurers — representing more than two-thirds of the market — have submitted inflated bills, according to the federal audits. And four of the five largest players — UnitedHealth, Humana, Elevance and Kaiser — have faced federal lawsuits alleging that efforts to overdiagnose their customers crossed the line into fraud.

The fifth company, CVS Health, which owns Aetna, told investors its practices were being investigated by the Department of Justice.

In statements, most of the insurers disputed the allegations in the lawsuits and said the federal audits were flawed. They said their aim in documenting more conditions was to improve care by accurately describing their patients’ health.

Many of the accusations reflect missing documentation rather than any willful attempt to inflate diagnoses, said Mark Hamelburg, an executive at AHIP, an industry trade group. “Professionals can look at the same medical record in different ways,” he said.

The government now spends nearly as much on Medicare Advantage’s 29 million beneficiaries as on the Army and Navy combined. It’s enough money that even a small increase in the average patient’s bill adds up: The additional diagnoses led to $12 billion in overpayments in 2020, according to an estimate from the group that advises Medicare on payment policies — enough to cover hearing and vision care for every American over 65.

Another estimate, from a former top government health official, suggested the overpayments in 2020 were double that, more than $25 billion.

The increased privatization has come as Medicare’s finances have been strained by the aging of baby boomers. But for insurers that already dominate health care for workers, the program is strikingly lucrative: A study from the Kaiser Family Foundation, a research group unaffiliated with the insurer Kaiser, found the companies typically earn twice as much gross profit from their Medicare Advantage plans as from other types of insurance.

For people choosing between traditional Medicare and Medicare Advantage, there are trade-offs. Medicare Advantage plans can limit patients’ choice of doctors, and sometimes require jumping through more hoops before getting certain types of expensive care.

But they often have lower premiums or perks like dental benefits — extras that draw beneficiaries to the programs. The more the plans are overpaid by Medicare, the more generous to customers they can afford to be.

“Medicare Advantage is an important option for America’s seniors, but as Medicare Advantage adds more patients and spends billions of dollars of taxpayer money, aggressive oversight is needed,” said Senator Charles Grassley of Iowa, who has investigated the industry. The efforts to make patients look sicker and other abuses of the program have “resulted in billions of dollars in improper payments,” he said.

Many of the fraud lawsuits were initially brought by former employees under a federal whistle-blower law that allows them to get a percentage of any money repaid to the government if their suits prevail. But most have been joined by the Justice Department, a step the government takes only if it believes the fraud allegations have merit. Last year, the department’s civil division listed Medicare Advantage as one of its top areas of fraud recovery.

“It’s an extremely high priority for us,” said Michael Granston, a deputy assistant attorney general for the civil division.

In contrast, regulators overseeing the plans at the Centers for Medicare and Medicaid Services, or C.M.S., have been less aggressive, even as the overpayments have been described in inspector general investigations, academic research, Government Accountability Office studies, MedPAC reports and numerous news articles, over the course of four presidential administrations.

Congress gave the agency the power to reduce the insurers’ rates in response to evidence of systematic overbilling, but C.M.S. has never chosen to do so. A regulation proposed in the Trump administration to force the plans to refund the government for more of the incorrect payments has not been finalized four years later. Several top officials have swapped jobs between the industry and the agency.

C.M.S. officials declined interview requests. In a statement, the C.M.S. administrator, Chiquita Brooks-LaSure, said the agency recently sought feedback on how to improve the program. “We are committed to making sure that Medicare dollars are used efficiently and effectively in Medicare Advantage,” she said.

The popularity of Medicare Advantage plans has helped them avoid legislative reforms. The plans have become popular in urban areas, and have been increasingly embraced by Democrats as well as Republicans. Nearly 80 percent of U.S. House members signed a letter this year saying they were “ready to protect the program from policies that would undermine” its stability.

“You have a powerful insurance lobby, and their lobbyists have built strong support for this in Congress,” said Representative Lloyd Doggett, a Texas Democrat who chairs the House Ways and Means Health subcommittee.

Some critics say the lack of oversight has encouraged the industry to compete over who can most effectively game the system rather than who can provide the best care.

“Even when they’re playing the game legally, we are lining the pockets of very wealthy corporations that are not improving patient care,” said Dr. Donald Berwick, a C.M.S. administrator under the Obama administration, who recently published a series of blog posts on the industry. “When you skate to the edge of the ice, sometimes you’re going to fall in.”

Congress’s first attempt to design a privatized Medicare plan paid insurers the same amount for every patient with similar demographic characteristics.

In theory, if the insurers could do better than traditional Medicare — by better managing patients’ care, or otherwise improving their health — their patients would cost less and the insurers would make more money.

But some insurers engaged in strategies — like locating their enrollment offices upstairs, or offering gym memberships — to entice only the healthiest seniors, who would require less care, to join. To deter such tactics, Congress decided to pay more for sicker patients.

Almost immediately, companies saw ways to exploit that system. The traditional Medicare program provided no financial incentive to doctors to document every diagnosis, so many records were incomplete. Under the new program, insurers began rigorously documenting all of a patient’s health conditions — say depression, or a long-ago stroke — even when they had nothing to do with the patient’s current medical care.

In one early case, a Florida medical practice was accused of falsifying diagnoses to enrich its owner and Humana. When Humana told the doctor who owned the practice that his Medicare risk adjustment, or M.R.A., scores had increased significantly, he responded by email, according to the whistle-blower lawsuit: “Good, I am trying to buy that house based on M.R.A. scores.” The case was settled for more than $3 million.

The doctor denied any wrongdoing. Humana declined to comment on the lawsuit and said it takes compliance “seriously.” The company recently told investors it had been questioned by the Justice Department about its billing practices and expected additional litigation.

At conferences, companies pitched digital services to analyze insurers’ medical records and suggest additional codes. Such consultants were often paid on commission; the more money the analysis turned up, the more the companies kept.

The insurers also began hiring agencies that sent doctors or nurses to patients’ homes, where they could diagnose them with more diseases.

One company, Mobile Medical Examination Services, worked with Anthem and Molina, among others. Its doctors and nurses were pushed to document a range of diagnoses, including some — vertebral fractures, pneumonia and cancer — they lacked the equipment to detect, according to a whistle-blower lawsuit. According to the lawsuit, employees who drew patients’ blood often were not provided with a centrifuge or cooler; spoiled blood analyzed a day later produced strange results that could be used to justify valuable diagnoses, including kidney disease and leukemia. The company was acquired by Quest Diagnostics after the case was settled for an undisclosed amount in 2016; Quest said the company complies with all federal and state laws and regulations.

Cigna hired firms to perform similar at-home assessments that generated billions in extra payments, according to a 2017 whistle-blower lawsuit, which was recently joined by the Justice Department. The firms told nurses to document new diagnoses without adjusting medications, treating patients or sending them to a specialist.

According to the lawsuit, some patients were diagnosed with cancer and heart disease. Nurses were told to especially look for patients with a history of diabetes because it was not “curable,” even if the patient now had normal lab findings or had undergone surgery to treat the condition.

The company declined to comment. “We will vigorously defend our Medicare Advantage business against these allegations,” Cigna said in an earlier statement regarding the lawsuit.

Adding the code for a single diagnosis could yield a substantial payoff. In a 2020 lawsuit, the government said Anthem instructed programmers to scour patient charts for “revenue-generating” codes. One patient was diagnosed with bipolar disorder, although no other doctor reported the condition, and Anthem received an additional $2,693.27, the lawsuit said. Another patient was said to have been coded for “active lung cancer,” despite no evidence of the disease in other records; Anthem was paid an additional $7,080.74. The case is continuing.

The most common allegation against the companies was that they did not correct potentially invalid diagnoses after becoming aware of them. At Anthem, for example, the Justice Department said “thousands” of inaccurate diagnoses were not deleted. According to the lawsuit, a finance executive calculated that eliminating the inaccurate diagnoses would reduce the company’s 2017 earnings from reviewing medical charts by $86 million, or 72 percent.

In a statement, the company, now named Elevance, said it would “vigorously defend our Medicare risk adjustment practices” and accused the government of holding it to standards “that are not grounded in formal statutory and regulatory rules.”

Some of the companies took steps to ensure the extra diagnoses didn’t lead to expensive care. In an October 2021 lawsuit, the Justice Department estimated that Kaiser earned $1 billion between 2009 and 2018 from additional diagnoses, including roughly 100,000 findings of aortic atherosclerosis, or hardening of the arteries. But the plan stopped automatically enrolling those patients in a heart attack prevention program because doctors would be forced to follow up on too many people, the lawsuit said.

Kaiser, which both runs a health plan and provides medical care, is often seen as a model system. But its control over providers gave it additional leverage to demand additional diagnoses from the doctors themselves, according to the lawsuit.

“The cash monster was insatiable,” said Dr. James Taylor, a former coding expert at Kaiser who is one of 10 whistle-blowers to accuse the organization of fraud.

At meetings with supervisors, he was instructed to find additional conditions worth tens of millions of dollars. “It was an actual agenda item and how could we get this,” Dr. Taylor said.

Marc T. Brown, a Kaiser spokesman, said in a statement, “We are confident in our compliance with Medicare Advantage risk-adjustment program requirements,” and added, “Our policies and practices represent well-reasoned and good-faith interpretations of sometimes vague and incomplete guidance from C.M.S.”

Last year, the inspector general’s office noted that one company “stood out” for collecting 40 percent of all Medicare Advantage’s payments from chart reviews and home assessments despite serving only 22 percent of the program’s beneficiaries. It recommended Medicare pay extra attention to the company, which it did not name, but the enrollment figure matched UnitedHealth’s.

A civil trial accusing UnitedHealth of fraudulent overbilling is scheduled for next year. The company’s internal audits found numerous mistakes, according to the lawsuit, which was joined by the Justice Department. Some doctors diagnosed problems like drug and alcohol dependence or severe malnutrition at three times the national rate. But UnitedHealth declined to investigate those patterns, according to the suit.

Matthew Wiggin, a spokesman for the company, called the inspector general’s report “misleading.” He said the company uses diagnostic coding to improve patient care, and noted that the whistle-blower in the lawsuit had not worked for the company in nearly a decade. “Our chart review process complies with regulatory standards,” he said, adding, “Our robust compliance program also proactively seeks to identify fraud, waste and abuse in the system.”

The company countered by suing Medicare, arguing that it wasn’t required to fix inaccurate records before regulations changed in 2014. It won at first, then lost on appeal. In June, the Supreme Court declined to hear the case.

Even before the first lawsuits were filed, regulators and government watchdogs could see the number of profitable diagnoses escalating. But Medicare has done little to tamp down overcharging.

Several experts, including Medicare’s advisory commission, have recommended reducing all the plans’ payments. Congress has ordered several rounds of cuts and gave C.M.S. the power to make additional reductions if the plans continued to overbill. The agency has not exercised that power.

The agency does periodically audit insurers by looking at a few hundred of their customers’ cases. But insurers are fined for billing mistakes found only in those specific patients. A rule proposed during the Trump administration to extrapolate the fines to the rest of the plan’s customers has not been finalized.

Some of the agency’s top leaders have had close ties to industry. Marilyn Tavenner, a former C.M.S. administrator, left in 2015, then ran the main trade group for health insurers; she was replaced by Andy Slavitt, a former executive at UnitedHealth. Jonathan Blum, the agency’s current chief operating officer, worked for an insurer after leaving the agency in 2014, then became an industry consultant, before returning to Medicare last year.

Ted Doolittle, who served as a senior official for the agency’s Center for Program Integrity from 2011 to 2014, said officials at Medicare seemed uninterested in confronting the industry over these practices. “It was clear that there was some resistance coming from inside” the agency, he said. “There was foot dragging.”

There are signs the problem is continuing.

“We are hearing about it more and more,” said Jacqualine Reid, a government research analyst at the Office of Inspector General who has analyzed Medicare Advantage overbilling.

The Justice Department has brought or joined 12 of the 21 cases that have been made public. But whistle-blower cases remain secret until the department has evaluated them. “We’re aware of other cases that are under seal,” said Mary Inman, a partner at the firm Constantine Cannon, which represents many of the whistle-blowers.

But few analysts expect major legislative or regulatory changes to the program.

“Medicare Advantage overpayments are a political third rail,” said Dr. Richard Gilfillan, a former hospital and insurance executive and a former top regulator at Medicare, in an email. “The big health care plans know it’s wrong, and they know how to fix it, but they’re making too much money to stop. Their C.E.O.s should come to the table with Medicare as they did for the Affordable Care Act, end the coding frenzy, and let providers focus on better care, not more dollars for plans.”

Alicia Parlapiano contributed graphics.

https://nytimes.com…

The American Way of Health Insurance: Incur Medical Debt & Lose Access to Care

Summary: The experience of a woman with breast cancer who loses her insurance perfectly illustrates the gaps and harms of our fragmented health insurance system. It’s a heart-rending plea for the US to adopt generous and efficient universal insurance as in wealthy countries around the world.

Medical debt ruined her credit. ‘It’s like you’re being punished for being sick’, NPR Shots, October 6, 2022, by Aneri Pattani

After a year of chemotherapy and radiation, doctors told Penelope Wingard in 2014 that her breast cancer was in remission. She’d been praying for this good news. But it also meant she no longer qualified for a program in North Carolina that offers temporary Medicaid coverage to patients undergoing active breast cancer treatment.

Wingard became uninsured. She’d survived the medical toll, but the financial toll was ongoing.

Bills for follow-up appointments, blood tests and scans quickly piled up. Soon, her oncologist said he wouldn’t see her until she paid down the debt.

“My hair hadn’t even grown back from chemo,” Wingard says, “and I couldn’t see my oncologist.”

Medical debt has sunk her credit score so low that she has struggled to qualify for loans, and applying for jobs and apartments has become a harrowing experience.

“It’s like you’re being punished for being sick,” Wingard says. …

Under the new [medical debt] policies, Equifax, Experian and TransUnion will remove from credit reports any paid debts or individual bills that were less than $500 and had gone to collections, even if unpaid. This doesn’t wipe out what people owe, but the idea is to remove the black mark of collections from their credit so they can more easily reach milestones like qualifying for a car or home loan ….

“Although the credit reporting companies have trumpeted this as a big change, the fact is they’re just removing the small stuff,” says Ryan Sandler, a senior economist with the Consumer Financial Protection Bureau. “They’re not maybe doing as good of a thing as their press releases would like you to believe.”

Wingard has worked as an after-school teacher and tutor, a COVID-19 contact tracer and a driver for a ride-hailing service, but none of those jobs has come with health insurance benefits. Wingard says she tried to buy private insurance on the marketplace several years ago, but her monthly premium would have been more than $200, which she can’t afford.

That left her on the hook for bill after bill after bill. Her credit report shows five pages of notifications from collection agencies representing doctor’s offices, hospitals and labs.

Nearly 20% with medical debt fear they’ll never pay it off.

Comment:

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

“It’s like you’re being punished for being sick.” I can’t get that thought out of my head.

When, when, when will our policymakers embrace the experience of dozens of countries around the world with universal insurance that doesn’t penalize people for getting sick? And that saves money in the process?

How much evidence do we need to collectively say, “American values” is no excuse for a fragmented, inequitable, punitive, harmful, and wasteful financing system?

When will we become sane and kind about how we pay for health care?

http://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Hospitals Serving Black Patients Are Paid Less

Summary: A commentary by researchers highlights inequalities in the financing of hospitals: those serving mainly Black patients have substantially lower capital investment and payment levels. This is structural racism, reflecting a long history of discriminatory programs and policies.

Hospital financing in black and white, STAT News, September 20, 2022, by Gracie Himmelstein, Joniqua Ceasar, and Kathryn E.W. Himmelstein

During our training as doctors, we have rotated through safety-net hospitals, elite academic medical centers, and private clinics. The resources for patient care and comfort were sumptuous in some facilities, spartan in others. The differences were often night and day or, as we quantified in a later analysis, black and white: we cared for far more white patients at highly resourced facilities and many more Black patients and other patients of color at those with fewer resources.

While the 1964 Civil Rights Act forbade hospitals from discriminating based on race, segregation persists. According to Medicare data we analyzed, a relative handful of hospitals — just 10% of all hospitals — provide three-quarters of all care for Black people covered by Medicare.

We found that in hospital care, as in public education, separate usually means unequal. The hospitals in which Black people account for a large share of inpatients have relatively meager facilities — as measured by the dollar value of the buildings and equipment — and are much less likely than other hospitals to offer expensive, high-tech, and often life-saving services like cardiac catheterization labs, or even routine ones like cardiac rehab programs. The term “structural racism” seems particularly apt for these systematic inequalities in hospitals’ bricks, mortar, and equipment.

Race-based inequities in hospital resources are the legacy of slavery, discrimination, and health care financing policies that directed resources to white communities and away from communities of color. The current-day hospital payment system continues to cement these inequities by assigning different dollar values to the care of different patients: lower values for care delivered to people who are uninsured or covered by Medicaid, and higher values to care for the privately insured and patients with Medicare — especially those able to pay deductibles, copayments, and coinsurance.

Black people are more likely to be consigned to the lower-value group. Far more Black people are uninsured or rely on Medicaid than white people, and Black workers are less likely than white workers to have job-based private insurance. Fewer privately insured Black families have the financial assets needed to cover the often substantial out-of-pocket costs of an insured hospital stay. This payment structure incentivizes hospital leaders to favor services and outreach efforts that attract lucrative — and predominantly white — patients.

… Hospitals caring for large shares of Black patients were paid $283 less for each day of a patient’s hospital stay compared to other hospitals. As a result, while many hospitals realized profits from their inpatient care, Black-serving facilities ran in the red…

Equalizing funding would have required $14 billion in additional payments to Black-serving hospitals in 2018 (the most recent year for which data were available), or about $25 million per Black-serving hospital. …

That the U.S. hospital payment system values different patients differently — and hence penalizes Black-serving hospitals — is a policy choice, and an unusual one among wealthy nations. In most other wealthy nations, even those like Germany with hundreds of different insurance plans, a single fee schedule applies to all patients. In the U.S., the second-class status of those covered by Medicaid was baked in at the outset when, in the midst of the Civil Rights era, Congress chose to separate coverage for the poor (many of whom were Black) from that of the elderly (most of whom were white). Medicare offered seniors a federal plan modeled on Blue Cross coverage, while Medicaid, passed simultaneously, relegated the poor to a welfare-based program largely controlled, even today, by state governments, some of them explicitly racist.

That the current hospital financing system assigns a lower dollar value to the care and lives of Black patients is a largely hidden but pernicious form of structural racism. Health reforms should equalize payments among patients and hospitals, and repair the damage of past policies by directing investments to resource-starved facilities that have long served Black communities.

Comment:

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

This important commentary by health services researchers highlights how hospitals that serve predominantly Black populations are financially compromised. They have 40% lower investment in facilities and receive 22% lower payments for services than hospitals which serve mainly White populations. This is the inequitable effect of a health care financing mix that systematically underpays for Black patient populations, who are more likely to be covered by Medicaid or uninsured.

For those interested in more technical detail, see the two academic articles: capital assets of $5,197/patient-day at black-serving hospitals, $5,763 at Hispanic-serving hospitals, and $8,325 at other hospitals and mean revenues were $283 lower/patient day and mean profits were $111/patient day lower at Black-serving hospitals.

The authors point out that in Germany, with its many private insurers, a single fee schedule applies to all patients, preventing these kinds of inequities. Other strengths of the German system: the insurers sell a standardized broad benefit plan, with no profit (they can profit from a small market in voluntary supplemental insurance).

In the US, this kind of parity and simplicity would be most easily achieved with a single payer system. Health insurers here would never accept the not-for-profit and one-product constraints applied in Germany.

A final note: It’s wonderful to see this important work from two offspring of legendary single payer advocates and researchers (and HJM bloggers) David Himmelstein and Steffie Woolhandler.

http://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

25-year-olds (and all of us) struggle with complex & flawed health insurance options

Summary: The vexing experience of finding health insurance hits the nearly 26-year-olds as they must exit parents’ health plans. Their focused dilemma echoes our collective dilemma: so many insurance options, all of them flawed. What we need is one high quality option: single payer.

For 20-Somethings, a Confusing Rite of Passage: Finding Health Insurance, The New York Times, September 30, 2022, by Isabella Simonetti

Whether they are 25 and about to age out of a parent’s plan or entering the work force for the first time, young Americans are tasked with making crucial decisions about their health care at a time when they may have little understanding of how insurance works.

Depending on the situation, a young adult might weigh these choices: staying on a parent’s plan till 26, joining an employer-sponsored health insurance plan or buying coverage on their state’s marketplace. Someone with an income up to 138 percent of the federal poverty level may even qualify for Medicaid, which offers free or inexpensive health care for low-income Americans, including pregnant women and seniors. The next open enrollment period (the period when you can sign up for coverage) for marketplace plans that comply with the A.C.A. runs from Nov. 1 to Jan. 15, 2023 for most states. Many employers offer open enrollment periods, too, that are typically in the fall, but the timing varies from company to company.

The marketplace plans offer different tiered private insurance options with government subsidies for people whose income falls below a certain threshold. While the service is mainly available through Healthcare.gov, some states, including California and Pennsylvania, operate their own websites. Although the open enrollment period is fixed, those who have experienced a so-called qualifying event, like losing insurance through an employer or being forced off a parent’s insurance after a 26th birthday, have 60 days from that event to enroll in a marketplace plan. If you miss the cutoff, you will have to wait until the next enrollment period, unless there has been a major event like a natural disaster.

For those deciding whether or not to join an employer plan, it is wise to compare its cost and coverage with that of a parent’s plan. If a parent’s plan is cheaper and offers better coverage, asking your parents if they will share the cost with you might be the best solution.

Be careful about taking on the cheapest plan an employer offers, because often that will mean having to pay a higher annual deductible before coverage kicks in.

Among employer plans, there may be the option to choose between a Preferred Provider Organization plan and a Health Maintenance Organization plan. A P.P.O. plan generally is more expensive on a monthly basis but may offer more out-of-network coverage, which could be necessary if you have specific medical needs. An H.M.O., though, is typically less expensive and includes a smaller group of providers.

Comment:

By Don McCanne, M.D.

The 26-year-old seems to have the epitome of American style health care coverage: a conglomeration of market plans, government plans, and government subsidies, with qualifications varying based on personal circumstances. Thus, medical benefits can vary, financial protection can vary, and eligibility for health care professionals and institutions can vary, resulting in unstable care access security and unstable financial security in the face of health care needs. On top of that, the 26-year-old also has an obligation through the tax system to help pay for the health care of others through government programs such as Medicare, Medicaid, the VA, county hospitals and clinics, and so forth.

It seems that the 26-year-old would be much better served by an efficient system that would automatically provide health care whenever needed and that was funded equitably based on ability to pay through progressive taxes. Of course, that would be of benefit not only at 26, but also throughout life as a well-designed single payer program such as Medicare for All.

Instead, we offer the American 26-year-old this highly dysfunctional, expensive hodgepodge of a health care financing that has far worse outcomes than in other wealthy nations. Wouldn’t they prefer care nirvana through single payer?

At 85, with some recent medical setbacks, I’ve been granted a gift of a little extra time, and I’m going to use it to shout to the heavens for a sane, humanitarian health care system for all of us. I am not alone. Remember, the Commonwealth Fund recently noted that a majority of Americans want President Biden and Congress to make health care spending a top priority this year, and many polls show 2/3 support for single payer.

When I was president of PNHP, John Conyers brought us single payer Medicare for All legislation. It would be only a matter of time to move it through the legislative process. What happened? Special interests. And they have continued to prevail ever since. It’s time for Congress respond to the needs of the people instead. It’s time to give citizen action life. Our voices need to finally drown out those of the special interests. To the streets!

http://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.

Medicare for All Explained Podcast: Episode 86

Medicare: A Complicated Mess

October 1, 2022

Podcast host Joe Sparks vents about the frustrating alphabet soup of Medicare plans that seniors must choose from during open enrollment.

“It took me hours to figure out the best option for me,” he says. “We could, and should, end this complicated Medicare mess with single-payer Medicare for All.”

Additional episodes will be uploaded twice monthly. Subscribe in iTunes, or access a complete archive of the podcast, below.

https://medicareforallexplained.podbean.com

The Dismal State of US Health Insurance

Summary: The 2022 Commonwealth survey of US health insurance tells a dismal story. 43% of adults 19-64 are inadequately insured; 46% report skipping care for financial reasons; and 42% have medical bill problems or debt. Our cobbled-together, profit-driven insurance approach is failing spectacularly and horrendously in its primary mission: providing access to care.

The State of U.S. Health Insurance in 2022 (Findings from the Commonwealth Fund Biennial Health Insurance Survey), The Commonwealth Fund, September 19, 2022, by Sara R. Collins, et al

Highlights

* Forty-three percent of working-age adults were inadequately insured in 2022.

* Twenty-nine percent of people with employer coverage and 44 percent of those with coverage purchased through the individual market and marketplaces were underinsured.

* Forty-six percent of respondents said they had skipped or delayed care because of the cost, and 42 percent said they had problems paying medical bills or were paying off medical debt.

* Half (49%) said they would be unable to pay for an unexpected $1,000 medical bill within 30 days, including 68 percent of adults with low income, 69 percent of Black adults, and 63 percent of Latinx/Hispanic adults.

* Sixty-eight percent of Democrats, 55 percent of Independents, and 46 percent of Republicans said President Biden and Congress should make health care costs a top priority in the coming year.

Comment:

By Don McCanne, M.D. and Jim Kahn, M.D., M.P.H.

We are all too familiar with these statistics demonstrating the inadequacy of our health care coverage in the United States – in spite of having the policy expertise and ample wealth to cover everyone. Indeed, doing so would save us money, by slashing the insane and insanely costly complexity.

Comprehensive health care reform is commonly dismissed because we lack the political support for it. But the survey finds that two-thirds of Democrats, and almost one-half of Republicans, want President Biden and Congress to make health care costs a top priority in the coming year!

With all of our other problems, that kind of support constitutes a mandate! Let’s get on with it!

http://healthjusticemonitor.org…

Stay informed! Subscribe to the McCanne Health Justice Monitor to receive regular policy updates via email, and be sure to follow them on Twitter @HealthJustMon.