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Emanuel and Liebman predict the end of private insurance

Emanuel and Liebman predict the end of private insurance

The End of Health Insurance Companies

By Ezekiel J. Emanuel and Jeffrey B. Liebman
The New York Times, January 30, 2012

Here’s a bold prediction for the new year. By 2020, the American health insurance industry will be extinct. Insurance companies will be replaced by accountable care organizations — groups of doctors, hospitals and other health care providers who come together to provide the full range of medical care for patients.

… thanks to the accountable care organizations provided for by the health care reform act, a new system is on its way, one that will make insurance companies unnecessary. Accountable care organizations will increase coordination of patient’s care and shift the focus of medicine away from treating sickness and toward keeping people healthy.

… accountable care organizations will typically be paid a fixed amount per patient, along with bonuses for achieving quality targets. The organizations will make money by keeping their patients healthy and out of the hospital and by avoiding unnecessary tests, drugs and procedures. Thus, they will actually have a financial incentive to hire that nurse for follow-ups.

In addition to providing better and more efficient care, A.C.O.’s will also make health insurers superfluous. Because they will each be responsible for a large group of patients (typically more than 15,000), they will pool the risk of patients who have higher-than-average costs with those with lower costs. And with the end of fee-for-service payments, insurance companies will no longer be needed to handle complicated billing and claims processing, nor will they need to be paid a fee for doing so. Payments can flow directly from an employer, Medicare or Medicaid to the accountable care organizations. A.C.O.’s will require enhanced information systems to track patients and figure out how to deliver more effective care, but this analytic capacity will be directed at improving health outcomes, not at imposing barriers to those seeking treatment.

A.C.O.’s are not simply a return to the health maintenance organizations of the 1990s. Although in both models patients are members of a provider network with a specific group of doctors and hospitals, and both are paid primarily per member rather than per procedure or test, there are big differences between them. H.M.O.’s were often large national corporations far removed from their members. In contrast, A.C.O.’s will consist of local health care providers working as a team to take care of patients who are likely to be members for years at a time.

A few health insurers see this asteroid coming. Wellpoint, for example, bought the clinic operator CareMore for $800 million last summer to make the transition into the A.C.O. business. Others, like the Optum unit of UnitedHealth Group, are developing data analysis services to provide to future A.C.O.’s. If they don’t want to go the way of the dinosaurs, insurance companies will have to find a new business to be in, one that is useful in the new world of coordinated care.

http://opinionator.blogs.nytimes.com/2012/01/30/the-end-of-health-insurance-companies/

Comment:

NYT Pick

Don McCanne
San Juan Capistrano, CA

The policy community, as represented by Ezekiel Emanuel and Jeffrey Liebman, speaks in glowing terms about idealistic, altruistic accountable care organizations (ACOs) in which health care professionals and institutions join together to improve quality and lower costs. Yet the specifics of the Medicare Shared Savings program that would establish ACOs through the Affordable Care Act (ACA), has only a superficial resemblance to these idealistic models.

The fact that the two largest for-profit insurers in the nation – WellPoint and UnitedHealth – are going after the ACO business is proof that we are in for more of the same. Eliminating private insurers by merely setting up ACOs is a pipe dream. The state insurance exchanges mandated by ACA are exchanges of private insurance plans, not ACOs.

We need to improve Medicare, dump the private insurers including the Medicare Advantage plans, and provide Medicare for everyone. Medicare has been far more effective than the private insurers in controlling costs, and would be even more so if it were our own publicly-financed single payer system.

http://opinionator.blogs.nytimes.com/2012/01/30/the-end-of-health-insurance-companies/?comments#permid=7

Market reforms will not result in health care for all in Maine

Federal and state programs will not achieve the savings promised by a single-payer system

By Julie Pease, M.D.
Portland Press Herald (Maine), Jan. 30, 2012

For two years, while great effort has been spent debating health care reforms, costs for health insurance have continued to spiral out of control. Contrary to the assertions of Sen. Deborah Sanderson in a Dec. 30 column (“Legislature is tackling the causes of Maine’s high health care costs”), there is simply no evidence to suggest that increasing competition in the for-profit insurance market will control health care costs, just as there is no evidence to suggest that federal reforms will be able to bring costs under control.

How much longer must we wait before we can agree that our health care system is irretrievably broken and recent incremental “reforms” are ineffective? How many families will go bankrupt due to medical expenses? How many people will die due to delaying care or being unable to access care at all?

The best way to control health care costs and to bring quality comprehensive health care to all Maine people is through a universal single-payer health care system. Under a universal system, everybody would be equally affected by changes in benefits and eligibility would become a moot point. The conversation in Augusta would be much different if Gov. LePage were proposing health care cuts for all Mainers rather than our most impoverished and vulnerable citizens.

Eliminating administrative waste would save a great deal of money. In testimony before the Maine Legislature, Harvard Professor William Hsiao estimated potential savings in the first year under single-payer to be $1 billion in Maine alone!

Maine could use these savings to provide real health care benefits instead of wasting money on administrative overhead or insurance company profits. Shifting from a for-profit to a not-for-profit financing mechanism would place the focus of health care on healing and health rather than profitability.

It is time to follow the lead of our neighbors in Vermont who have taken steps toward universal health care. We can’t afford to wait.

Julie Pease, M.D., is president of the board of directors of Maine AllCare. She lives in Brunswick.

http://www.pressherald.com/opinion/market-reforms-will-not-result-in-health-care-for-all-in-maine_2012-01-30.html

To rein in health costs, look to single payer

Letters, The New York Times, January 29, 2012

To the Editor:

Ezekiel J. Emanuel chooses to assign liberals with controlling costs in health care, when he should be waving his finger at the health care sector. When “skyrocketed” health care costs come up, profit never makes it into the discussion or calculations.

Dr. Emanuel should remember, too, that many liberals wanted the cost-saving, improved Medicare-for-all system to be included in Senator Max Baucus’s committee hearings. Sadly, the cabal made sure that its proponents got no seat at the table.

H.R. 676, the Expanded and Improved Medicare for All Act, would have cut out unnecessary administrative costs, given Americans real choice in their health care, and dissolved the employment-benefits contract that keeps us an indentured labor force. These are factors that both liberals and conservatives should be able to support.

BARBARA COMMINS
San Francisco, Jan. 22, 2012

The writer is a registered nurse.

To the Editor:

Ezekiel J. Emanuel suggests that liberals “ignore costs.” He doesn’t seem to recognize that many conservatives oppose the payment reform proposals in the Affordable Care Act. Remember the outcry about “death panels”?

Moreover, it should not be a given that insurers should continue to consume a large fraction of the health care dollar.

There are many good options for payment reform not included in the health care law. We need a wider discussion on how care is paid for, and how everyone can have access to care in a way that is more efficient, safer and better.

Our government should not write off the possibility of single-payer (which it has so far, largely because of conservative opposition). Those are liberal ideas, and they do not mean that costs should be ignored.

BRUCE L. WILDER
Pittsburgh, Jan. 22, 2012

The writer is a neurosurgeon and a lawyer.

http://www.nytimes.com/2012/01/30/opinion/health-costs-regardless-of-your-politics.html

Emanuel and Liebman predict the end of private insurance

The End of Health Insurance Companies

By Ezekiel J. Emanuel and Jeffrey B. Liebman
The New York Times, January 30, 2012
Here’s a bold prediction for the new year. By 2020, the American health insurance industry will be extinct. Insurance companies will be replaced by accountable care organizations — groups of doctors, hospitals and other health care providers who come together to provide the full range of medical care for patients.
… thanks to the accountable care organizations provided for by the health care reform act, a new system is on its way, one that will make insurance companies unnecessary. Accountable care organizations will increase coordination of patient’s care and shift the focus of medicine away from treating sickness and toward keeping people healthy.
… accountable care organizations will typically be paid a fixed amount per patient, along with bonuses for achieving quality targets. The organizations will make money by keeping their patients healthy and out of the hospital and by avoiding unnecessary tests, drugs and procedures. Thus, they will actually have a financial incentive to hire that nurse for follow-ups.
In addition to providing better and more efficient care, A.C.O.’s will also make health insurers superfluous. Because they will each be responsible for a large group of patients (typically more than 15,000), they will pool the risk of patients who have higher-than-average costs with those with lower costs. And with the end of fee-for-service payments, insurance companies will no longer be needed to handle complicated billing and claims processing, nor will they need to be paid a fee for doing so. Payments can flow directly from an employer, Medicare or Medicaid to the accountable care organizations. A.C.O.’s will require enhanced information systems to track patients and figure out how to deliver more effective care, but this analytic capacity will be directed at improving health outcomes, not at imposing barriers to those seeking treatment.
A.C.O.’s are not simply a return to the health maintenance organizations of the 1990s. Although in both models patients are members of a provider network with a specific group of doctors and hospitals, and both are paid primarily per member rather than per procedure or test, there are big differences between them. H.M.O.’s were often large national corporations far removed from their members. In contrast, A.C.O.’s will consist of local health care providers working as a team to take care of patients who are likely to be members for years at a time.
A few health insurers see this asteroid coming. Wellpoint, for example, bought the clinic operator CareMore for $800 million last summer to make the transition into the A.C.O. business. Others, like the Optum unit of UnitedHealth Group, are developing data analysis services to provide to future A.C.O.’s. If they don’t want to go the way of the dinosaurs, insurance companies will have to find a new business to be in, one that is useful in the new world of coordinated care.
http://opinionator.blogs.nytimes.com/2012/01/30/the-end-of-health-insurance-companies/

Comment originally posted on the New York Times’ website.
NYT Pick
Don McCanne
San Juan Capistrano, CA
The policy community, as represented by Ezekiel Emanuel and Jeffrey Liebman, speaks in glowing terms about idealistic, altruistic accountable care organizations (ACOs) in which health care professionals and institutions join together to improve quality and lower costs. Yet the specifics of the Medicare Shared Savings program that would establish ACOs through the Affordable Care Act (ACA), has only a superficial resemblance to these idealistic models.
The fact that the two largest for-profit insurers in the nation – WellPoint and UnitedHealth – are going after the ACO business is proof that we are in for more of the same. Eliminating private insurers by merely setting up ACOs is a pipe dream. The state insurance exchanges mandated by ACA are exchanges of private insurance plans, not ACOs.
We need to improve Medicare, dump the private insurers including the Medicare Advantage plans, and provide Medicare for everyone. Medicare has been far more effective than the private insurers in controlling costs, and would be even more so if it were our own publicly-financed single payer system.

Paying for a free screening colonoscopy

'Free' preventive care can cost patients big money: Is procedure a screening or therapeutic?

By Tom Kisken
Ventura County Star, January 28, 2012

Patients are getting charged as much as $3,000 for screenings they thought would be free under a federal health care reform mandate that promises free preventive care.

Most of the problems revolve around colonoscopies — screenings designed to detect colon and rectal cancers that kill about 52,000 Americans a year.

The procedure has been covered by federal health care reform for men and women 50 and older since September 2010, although many older insurance policies are exempt from the new provision.

Some patients are still receiving bills for deductibles or co-pays when the procedures show an abnormal growth called a polyp that can develop into cancer.

Insurance companies may charge for screenings or tests if patients show symptoms of cancer or are going through a colonoscopy as a follow-up to an earlier diagnosis, said Robert Zirkelbach, spokesman for the trade group. But many insurers consider colonoscopies to be preventive care — and covered — regardless of whether polyps are present, he said. Bills are sent when they aren’t told the nature of the procedure.

“One of the challenges is: How are those procedures being coded by physicians?” he said. “Is it clear that it’s a preventive service?”

Some doctors, however, insist the issue isn’t coding, but rather money and the insurers’ desire for it.

“That is subterfuge,” said Dr. Paul Sanders, a Thousand Oaks gastroenterologist, contending insurers are shifting blame from themselves to physicians. “It’s utter baloney. The insurance companies have quite intentionally blocked any way that anybody could understand what they’re going to, and not going to, pay for.”

Charles Rosen, a Simi Valley insurance broker and president-elect of the California Association of Health Underwriters, tells clients to minimize chances of any billing confusion by not talking to a doctor about any health concerns during a screening exam.

“If you have a pending issue, make another appointment,” he said.

http://www.vcstar.com/news/2012/jan/28/free-preventive-care-can-cost-patients-big-money/

Comment: 

By Don McCanne, MD

Colonoscopy is one of several cancer screening tests that are covered 100 percent – no deductibles nor coinsurance are required. What separates out colonoscopy from the other screening tests is that it is frequently converted, on the spot, to a therapeutic procedure when polyps are detected and removed.

Somewhere between the billing office for the physician or outpatient department and the processing of the claim by the insurer, the diagnostic and procedure coding is changed from the free screening test to the therapeutic procedure, subject to cost sharing. The physician blames the insurer, and the insurer blames the physician. But it is the patient who is harmed by being required to pay the out-of-pocket costs of a therapeutic procedure after having been promised a free screening test.

As is typical in our health care financing system that turns decisions over to private insurers (even if only private administrators of Medicare), the president-elect of the California Association of Health Underwriters advises patients to withhold medical information until after they have received their free screening. Only then should they inform their physician about the rectal bleeding or the tenesmus that they have been experiencing. What’s a little fraud if it is only the patient that is committing it?

There are two policy lessons here.

One is that deductibles, co-payments and coinsurance should be eliminated for all appropriate care. Payment issues should not interfere with health care decisions made by the patient with the best advice of the physician. The harm dome by erecting financial barriers to care is potentially far greater than the almost negligible decrease in our national health expenditures that would result from cost sharing (most of which is merely shifted from the insurer to the patient). Obtaining appropriate health care should not result in the assessment of cost sharing penalties or fines.

The second policy lesson is that we need to throw the middleman crooks out. Only that industry would come up with a solution that patients should be instructed to lie to their health care professionals. Not a lie to withhold information? Isn’t the oath for swearing in, “The truth, the whole truth, and nothing but…”? Maybe the whole truth is confidential proprietary information. At least that’s what the insurers keep telling us when we ask for transparency.

Free-Market Medicine: A Personal Account

By Michael Parenti
CommonDreams, Jan. 27, 2012

When I recently went to Alta Bates hospital for surgery, I discovered that legal procedures take precedence over medical ones. I had to sign intimidating statements about financial counseling, indemnity, patient responsibilities, consent to treatment, use of electronic technologies, and the like.

One of these documents committed me to the following: “The hospital pathologist is hereby authorized to use his/her discretion in disposing of any member, organ, or other tissue removed from my person during the procedure.” Any member? Any organ?

The next day I returned for the actual operation. While playing Frank Sinatra recordings, the surgeon went to work cutting open several layers of my abdomen in order to secure my intestines with a permanent mesh implant. Afterward I spent two hours in the recovery room. “I feel like I’ve been in a knife fight,” I told one nurse. “It’s called surgery,” she explained.

Then, while still pumped up with anesthetics and medications, I was rolled out into the street. The street? Yes, some few hours after surgery they send you home. In countries that have socialized medicine (there I said it), a van might be waiting with trained personnel to help you to your abode.

Not so in free-market America. Your presurgery agreement specifies in boldface that you must have “a responsible adult acquaintance” (as opposed to an irresponsible teenage stranger) take you home in a private vehicle. I kept thinking, what happens to those unfortunates who have no one to bundle them away? Do they languish endlessly in the hospital driveway until the nasty weather finishes them off?

You are not allowed to call a taxi. Were a taxi driver to cause you any harm, you could hold the hospital legally responsible. Again it’s a matter of liability and lawyers, not health and doctors.

One of the two friends who helped me up the steps to my house then went off to Walgreen’s to buy the powerful antibiotics I had to take every four hours for two days. I dislike how antibiotics destroy the “good bacteria” that our bodies produce, and how they help create dangerous strains of super-resistant bacteria. I kept thinking of a recent finding: excessive reliance on medical drugs kills more Americans than all illegal narcotics combined.

So why did I have to take antibiotics? Because, as everyone kept telling me, hospitals are seriously unsafe places overrun with Staph infections and other super bugs. It’s a matter of self-protection.

Two days after surgery I noticed a dark red discoloration on my lower abdomen indicating internal bleeding. I was supposed to get a follow-up call from a nurse who would check on how I was doing. But the call might never come because the staff was planning a walkout. “We have no contract,” one of them had told me when I was in the recovery room. So now the nurses are on strike — and I’m left on my own to divine what my internal bleeding is all about. What fun.

Fortunately, it didn’t turn out that way. A nurse did call me despite the walkout. Yes, she said, it was internal bleeding, but it was to be expected. My surgeon called later in the day to confirm this opinion. Death was not yet knocking.

A few days later, there were massive nurses strikes on both coasts. Among other things, the nurses were complaining about “being disrespected by a corporate hospital culture that demands sacrifices from patients and those who provide their care, but pays executives millions of dollars.” (New York Times, 16 December 2011). One cold-blooded management negotiator was quoted as saying, “We have the money. We just don’t have the will to give it to you” (ibid.).

As for the doctors, both my surgeon and my general practitioner (GP) are among the victims, not the perpetrators, of today’s corporate medical system. My GP explained that it is an endless fight to get insurance companies to pay for services they supposedly cover. Feeling less like a doctor and more like a bill collector, my GP found he could no longer engage in endless telephone struggles with insurance companies.

There are 1,500 medical insurance companies in America, all madly dedicated to maximizing profits by increasing premiums and withholding payments. The medical industry in toto is the nation’s largest and most profitable business, with an annual health bill of about $1 trillion.

Along with the giant insurance and giant pharmaceutical companies, the greatest profiteers are the Health Maintenance Organizations (HMOs), notorious for charging steep monthly payments while underpaying their staffs and requiring their doctors to spend less time with each patient, sometimes even withholding necessary treatment.

I am without private insurance. And my Medicare goes just so far. Like many other doctors, my GP no longer accepts Medicare. For a number of years now, Medicare payments to physicians have remained relatively unchanged while costs of running a practice (staff, office space, insurance) have steadily increased. So now my GP’s patients have to pay in full upon every visit — which is not always easy to do.

Our health system mirrors our class system. At the base of the pyramid are the very poor. Many of them suffer through long hours in emergency rooms only to be turned away with a useless or harmful prescription. No wonder “the United States has the worst record among industrialized nations in treating preventable deaths” (Healthcare-NOW! 1 December 2011).

Too often the very poor get no care at all. They simply die of whatever illness assails them because they cannot afford treatment. An acquaintance of mine told me how her mother died of AIDS because she could not afford the medications that might have kept her alive.

In Houston I once got talking with a limousine driver, a young African-American man, who remarked that both his parents had died of cancer without ever receiving any treatment. “They just died,” he said with a pain in his voice that I can still hear. 

Living just above the poor in the class pyramid are the embattled middle class. They watch medical coverage disappear while paying out costly amounts to the profit-driven insurance companies. I was able to get surgery at Alta Bates only because I am old enough to have Medicare and have enough disposable income to meet the co-payment.

For my out-patient operation, the hospital charged Medicare $19,466. Of this, Medicare paid $2,527. And I was billed $644. The hospital then writes off the unpaid balance thus saving considerable sums in taxes (amounting to an indirect subsidy from the rest of us taxpayers). Had I no Medicare coverage, I would have had to pay the entire $19,466.

I was informed by the hospital that the $19,466 charge covers only hospital costs for equipment, technicians, supplies, and room. So besides the $644, I will have to pay for any pathologists, surgical assistants, and anesthesiologists who performed additional services. I am waiting for the other shoe to drop.

How much does my surgeon earn? Not much at all. He gets about $400 to $500 for everything, including my pre-op and post-op visits and the surgery itself, an exacting undertaking that requires skills of the highest sort. He also has to maintain insurance, an office, an assistant, and an increasing load of paperwork.

My surgeon pointed out to me, “If you ask people how much I make on an operation like yours, they will say $4000 to $5000, and be wrong by a factor of ten.” He noted that in a recent speech President Obama criticized a surgeon for charging $30,000 to replace a knee cap. “The surgeon gets a minute fraction of that amount,” my doctor pointed out. 

To make matters worse, there is talk about cutting Medicare payments to physicians by 27 percent. If this happens, it is going to be in
creasingly difficult to find a surgeon who will take Medicare. Still worse, the private insurance companies will join in squeezing the physicians for still more profits.

I was able to meet my payment ($644) not only because my operation was heavily subsidized by Medicare but because it was a one-day “ambulatory surgery.” I don’t know how I would fare if I had to undergo prolonged and extremely costly treatment.

So much for life in the middle class. At the very top of the class pyramid are the 1%, those who don’t have to worry about any of this, the superrich who have money enough for all kinds of state-of-the-art treatments at the very finest therapeutic centers around the world, complete with luxury suites with gourmet menus.

Among the medically privileged are members of Congress and the U.S. president. They pay nothing. They are treated at top-grade facilities. They enjoy, how shall we put it, socialized medicine. No conservative lawmakers have held fast to their free-market principles by refusing to accept this publicly funded, medical treatment.

John Mackey, CEO of Whole Foods, cheerfully announced that medical care is not a human right; it should be “market determined just like food and shelter.” Nobody has a higher opinion of John Mackey than I, and I think he is a greed-driven, union-busting bloodsucker. Nevertheless I will give him credit for candidly admitting his dedication to a dehumanized profit pathology.

The U.S. medical system costs many times more than what is spent in socialized systems, but it delivers much less in the way of quality care and cure. That’s the way it is intended to be. The goal of any free-market service — be it utilities, housing, transportation, education, or health care — is not to maximize performance but to maximize profits often at the expense of performance.

If profits are high, then the system is working just fine — for the 1%. But for us 99%, the profit lust is itself the heart of the problem.

Michael Parenti’s recent books include God and His Demons (Prometheus), Contrary Notions: The Michael Parenti Reader (City Lights); Democracy for the Few, 9th ed. (Wadsworth); The Assassination of Julius Caesar (New Press); Superpatriotism (City Lights); and The Culture Struggle (Seven Stories Press). For further information, visit his website: www.michaelparenti.org.

http://www.commondreams.org/view/2012/01/27-0

Lawmakers press Green Mountain Care Board on work plan

By Alan Panebaker
Vtdigger.org, Jan. 20, 2012

The Shumlin administration and the Green Mountain Care Board introduced road maps Thursday for how they plan to implement health care reform.

The board’s annual report and the administration’s Strategic Plan for Vermont Health Reform shed light on the specifics of how the state will maneuver to a health benefits exchange in 2014 and into a single-payer system in 2017.

Download the GMCB Annual Report

Last week the board approved its work plan, identifying high priorities for 2012. Anya Rader Wallack, chair of the Green Mountain Care Board, fielded questions from legislators Thursday that have become somewhat of the norm: How will the board maintain its independence from the Shumlin administration and how is a reformed system going to control costs?

Sen. Kevin Mullin, R-Rutland, pushed both Wallack and Director of Health Care Reform Robin Lunge on the issue of containing costs through tort reform. A report by Harvard economics professor Dr. William Hsiao last February recommended moving to a no-fault medical malpractice system similar to New Zealand. Act 48, last year’s health care reform law, requires a report to the legislature on the costs of reform. It was due this week, but the administration requested an extension until Jan. 30.

Mullin, who is vice chair of the Senate Committee on Health and Welfare, told Wallack that he thinks analysis is the most important issue for the board as it designs what will be a new health care system for the state.

“We should be looking at the best results from all different health care systems in world,” Mullin said. “We need to see if they work.”

Mullin said the board’s analysis should address what impacts other systems have on factors like patient safety and quality of care then make a decision based on all available information.

“What I’m afraid we’re going to hear is it’s a political compromise rather than a reasoned analysis,” Mullin said.

Wallack, who has been working on health care reform efforts since the 1990s, assured Mullin that the board is working to make sure it does the necessary research.

“In terms of having analytic capability moving forward, that’s absolutely what we’re moving toward,” Wallack said.

Currently, the board has 13 staff members, and it is in the process of hiring three more full-time.

The board’s work plan includes a plethora of tasks for analyzing data for evaluating quality and performance in the health care system, implementing pilot payment programs, and dealing with a host of issues involving insurance rate review and hospital budget oversight. The board has also submitted a grant application to the Robert Wood Johnson foundation for a payment reform project. Vermont was one of 15 sites invited to submit a proposal for the $500,000 grant out of 120 applicants.

The annual report also outlines the board’s estimated expenditures, which total around $2.1 million for 2012 and nearly $2.5 million for 2013.

Legislators also pressed Wallack on the recently-withdrawn request for proposal for a communications consultant. The issue became a political hot potato when Gov. Peter Shumlin expressed dismay that the the board was trying to hire what appeared to be a public relations firm.

Rep. Patti Komline, R-Dorset, asked Wallack why the board decided to back off so quickly amid criticism.

Wallack emphasized that the decision to withdraw the RFP was not in response to the governor and that the board will likely go back to the drawing board and make more clear what it is looking for.

“It’s not about PR,” Wallack said. “It’s about communicating with the public and engaging the public.”

With somewhat of an overlap between the administration’s mandate to implement a health benefits exchange dovetailing with the Green Mountain Care Board’s mandate to lay the groundwork for a universal health care system, Rep. Chris Pearson, P-Burlington, said he was concerned people are becoming confused and losing sight of the ultimate goal of single payer.

“We’ve really got to keep our eye on the prize,” Pearson said.

The focus on a health benefits exchange, which is a federal mandate, has become a point of frustration, he said.

“People are deeply interested in seeing a real health care system that is effective, and there’s a lot of anxiety about that,” Pearson said. “It’s all geared to this goal, but we can’t talk about it in a way the public understands if we’re not talking about the goal. Nobody is mentioning Green Mountain Care.”

The exchange is a step toward single payer, however, and transforming health care involves lots of moving parts.

“Just focusing on single payer and saying that’s going to be the silver bullet would be very naïve,” Wallack said.

Rep. George Till, D-Jericho, commended Wallack and the rest of the Green Mountain Care Board for their efforts.

“I’m impressed with the work they’re doing,” Till said.

He echoed Wallack’s point that health care reform involves more than the single payer concept where one government-run organization accepts all the health care fees and pays out all the health care costs.

“It’s really about the clinical and payment reforms that will control the health care costs which is the real aim in addition to providing health care to everybody,” Till said.

Despite his commendation, Till said he thought the board missed a tremendous opportunity to establish its independence from the governor when it decided to withdraw the request for proposal for a communications specialist.

He emphasized, also, the importance of moving to a no-fault medical malpractice system where patients who are injured would receive government-funded compensation rather than suing physicians for negligence. This type of system, which the Hsiao report recommended, reduces defensive medicine, which can really contain costs, according to the report.

http://vtdigger.org/2012/01/20/lawmakers-press-green-mountain-care-board-on-work-plan/

State releases report on single-payer plan

By CHRIS GAROFOLO / Reformer St
aff
The Brattleboro Reformer, Jan. 24, 2012

BRATTLEBORO, Vt. — Officials in the process of overhauling Vermont’s “unsustainable” health care system released a 21-page report on how the state will implement a single-payer plan within the next three to five years.

Anya Rader Wallack, chairwoman of the Green Mountain Care Board, said the report relates to Vermont’s health care delivery system and reform aimed at controlling rising costs in the state.

“One of the things I tell audiences when I go around the state and talk about our goals on cost containment is; you take current trends, which is about 6 or 7 percent increase per year in health care costs, trend it out to about 2020, if you reduce that by two percentage points, you save about $3 billion dollars between 2014 and 2019,” she said.

The Green Mountain Care Board and governor’s administration released its Strategic Plan for Vermont Health Reform last week. It proposes a guide for the state to implement the plan of Gov. Peter Shumlin, a first-term Democrat, to expand and improve health insurance coverage in Vermont.

“I think there is an important distinction to be made between what is proposed in Vermont and, for example, the Canadian system or United Kingdom where the government owns the delivery system,” Rader Wallack said.

“The financing would be public so the government would run the financing and have responsibility for raising funds that are now privately taken into the system,” she said. “The health care delivery system in Vermont is private and will remain private even under this plan.”

With the help from the state Legislature, the governor pushed through an ambitious measure to reduce health care costs while assuring Vermonters have access to coverage.

Lawmakers created the five-member care board within its bill to craft a cost containment system and design a plan on how to deliver health care to all Vermonters.

“It’s not a matter of spending new dollars on health care, it’s a question of where the dollars come from, and the main impact will be on people who pay premiums, because we’ll have to raise that money some other way,” said Commissioner Stephen W. Kimbell with the Department of Banking, Insurance, Securities & Health Care Administration.

Kimbell and Rader Wallack met with the Reformer Monday morning.

According to Kimbell, the state spends about $5 billion annually on health care. Vermont’s higher insurance costs and aging population are the major factors in the skyrocketing health care figures.

“We’re not talking about reducing overall expenditures, we’re talking about reducing the rate of growth. We’ve got a system of $5 billion now and we’re talking about growing it 2 or 3 percent instead of 6 or 7,” Kimbell said. “The most hopeful thing we’ve seen is that the provider community, hospitals and doctors, they sense the unsustainability on the path we’re on. They are working with us very closely.”

Said Rader Wallack: “Our whole thrust is how to change the whole framework for how we pay [providers], how we measure quality of care, but really we need health care providers to figure out what’s the best way to be more efficient.”

The strategic plan lists the responsibilities moving forward, specifying tasks and deadlines for different Vermont agencies.

Currently, the Green Mountain Care Board is working with BISHCA and the Department of Vermont Health Access to develop a health care budget that reflects the principles embodied in the legislation.

The health access department will implement simplifications to reduce administrative costs by 2014, two years after the board reviews payment and benefit design to encourage providers to drop expenses in care.

But the largely unanswered question of how the state finances such a health care system ultimately falls into the office of Vermont’s administration secretary, Rader Wallack said.

“They are supposed to come back with a more detailed plan around the single-payer financing and for how it would operate,” she said. “The question is, the portion that is now paid for through employment, can we divorce that from employment and have a system of financing where people don’t have to worry if their income changes, if their job changes, if they don’t have coverage … and also to relief employers, especially small employers of the burden of having to deal with choosing health insurance.”

Both the health access department and GMC board have the ongoing task of reducing cost-shifting between the public and private sectors by incorporating the effect on hospital budget processes, the state funding and rate-setting by insurance companies. All the payment reforms the state is currently reviewing have strong quality measurements.

“It’s really important to have a public-private conversation about, ‘We’re designing this new financing system and we intend to make sure the rate of growth in it is sustainable relative to our economic capability, how can we work with you private providers to make sure that’s not just a false promise,'” Rader Wallack said. “We are working with them to design a payment system and support delivery system changes that will actually lead to some efficiency and allow us to say something’s different in Vermont.”

The board will measure success over the next three years by checking enrollment numbers, the percentage of Vermonters underinsured and the rate of growth in health care expenditures.

Chris Garofolo can be reached at cgarofolo@reformer.com or 802-254-2311 ext. 275.

http://www.reformer.com/ci_19803543?IADID=Search-www.reformer.com-www.reformer.com

Paying for a free screening colonoscopy

‘Free’ preventive care can cost patients big money: Is procedure a screening or therapeutic?

By Tom Kisken
Ventura County Star, January 28, 2012
Patients are getting charged as much as $3,000 for screenings they thought would be free under a federal health care reform mandate that promises free preventive care.
Most of the problems revolve around colonoscopies — screenings designed to detect colon and rectal cancers that kill about 52,000 Americans a year.
The procedure has been covered by federal health care reform for men and women 50 and older since September 2010, although many older insurance policies are exempt from the new provision.
Some patients are still receiving bills for deductibles or co-pays when the procedures show an abnormal growth called a polyp that can develop into cancer.
Insurance companies may charge for screenings or tests if patients show symptoms of cancer or are going through a colonoscopy as a follow-up to an earlier diagnosis, said Robert Zirkelbach, spokesman for the trade group. But many insurers consider colonoscopies to be preventive care — and covered — regardless of whether polyps are present, he said. Bills are sent when they aren’t told the nature of the procedure.
“One of the challenges is: How are those procedures being coded by physicians?” he said. “Is it clear that it’s a preventive service?”
Some doctors, however, insist the issue isn’t coding, but rather money and the insurers’ desire for it.
“That is subterfuge,” said Dr. Paul Sanders, a Thousand Oaks gastroenterologist, contending insurers are shifting blame from themselves to physicians. “It’s utter baloney. The insurance companies have quite intentionally blocked any way that anybody could understand what they’re going to, and not going to, pay for.”
Charles Rosen, a Simi Valley insurance broker and president-elect of the California Association of Health Underwriters, tells clients to minimize chances of any billing confusion by not talking to a doctor about any health concerns during a screening exam.
“If you have a pending issue, make another appointment,” he said.
http://www.vcstar.com/news/2012/jan/28/free-preventive-care-can-cost-patients-big-money/

Colonoscopy is one of several cancer screening tests that are covered 100 percent – no deductibles nor coinsurance are required. What separates out colonoscopy from the other screening tests is that it is frequently converted, on the spot, to a therapeutic procedure when polyps are detected and removed.
Somewhere between the billing office for the physician or outpatient department and the processing of the claim by the insurer, the diagnostic and procedure coding is changed from the free screening test to the therapeutic procedure, subject to cost sharing. The physician blames the insurer, and the insurer blames the physician. But it is the patient who is harmed by being required to pay the out-of-pocket costs of a therapeutic procedure after having been promised a free screening test.
As is typical in our health care financing system that turns decisions over to private insurers (even if only private administrators of Medicare), the president-elect of the California Association of Health Underwriters advises patients to withhold medical information until after they have received their free screening. Only then should they inform their physician about the rectal bleeding or the tenesmus that they have been experiencing. What’s a little fraud if it is only the patient that is committing it?
There are two policy lessons here.
One is that deductibles, co-payments and coinsurance should be eliminated for all appropriate care. Payment issues should not interfere with health care decisions made by the patient with the best advice of the physician. The harm dome by erecting financial barriers to care is potentially far greater than the almost negligible decrease in our national health expenditures that would result from cost sharing (most of which is merely shifted from the insurer to the patient). Obtaining appropriate health care should not result in the assessment of cost sharing penalties or fines.
The second policy lesson is that we need to throw the middleman crooks out. Only that industry would come up with a solution that patients should be instructed to lie to their health care professionals. Not a lie to withhold information? Isn’t the oath for swearing in, “The truth, the whole truth, and nothing but…”? Maybe the whole truth is confidential proprietary information. At least that’s what the insurers keep telling us when we ask for transparency.

Single Payer 2 Votes Short in Calif. Senate

By David Gorn
California Healthline, Jan. 27, 2012

The idea of a single-payer health care system in California stalled on the Senate floor yesterday, falling two votes short of passage.

Reconsideration of the bill was granted, though, so proponents of SB 810 by Mark Leno (D-San Francisco) have until Tuesday to reintroduce the bill. First they will have to come up with two big votes. The bill failed on a 19-15 vote.

“We don’t want to follow the path of Europe, where the economy is in trouble, where the Euro is failing,” Sen. Ted Gaines (R-Roseville) said. “It’s not the example we should follow. We don’t have the money. I don’t know where the money’s going to come from.”

Gaines also pointed out that California, when compared with nations, has slipped to ninth in economic ranking. Bill author Leno had an answer for that one: “Those other eight economies larger than ours, they all have health care that costs them a lot less than ours does. Maybe we’re missing something here.”

All Republicans present voted against the bill. The abstention of four moderate Democrats and one Democrat’s “No” vote turned the political tide on single payer, proponents said.

The idea of universal coverage has been passed by the Legislature before. In 2007 and 2009, both houses approved the idea, only to have it vetoed by Gov. Schwarzenegger. Last year, it passed the Senate and stalled when it was not brought to the floor in the Assembly.

In yesterday’s Senate discussion, Joseph Simitian (D-Santa Clara) said he had some reservations about the bill but felt it was too important an issue to dismiss.

“I sometimes think we have the wrong debate on the Senate floor,” Simitian said. “The fundamental question is: Does every Californian have the right to access quality, affordable health care? I will be casting an aye vote today, because I believe every Californian should have that, everyone should get quality, affordable health care in California.”

If the bill is reintroduced by Tuesday and it gets 21 votes on the Senate floor, it would move to the Assembly.

http://www.californiahealthline.org/capitol-desk/2012/1/single-payer-fails-on-senate-floor.aspx#ixzz1kgHeZWZt

Medical debts put patients at risk of financial collapse

By Lindy Washburn
The Republic (Columbus, Ind.), Jan. 27, 2012

HACKENSACK, N.J. — Frances Giordano found out she had lung cancer in June. After that, the bad news just kept coming.

First, she discovered that even with a good job and health insurance, her medical expenses were more than she could afford on disability.

Then she started slipping into debt, like millions of other Americans who don’t have the cash to cover their medical bills. Hospitals expect to be paid promptly and offer little leeway to insured patients. Unpaid bills go to collection agencies, damaging a person’s credit history for years.

Finally, she learned that fighting for her life was not her only battle or maybe even her toughest. When she finished her chemotherapy in December, she was fired. “Due to changes in business operations,” wrote her employer of more than six years, “We can no longer hold your position open.”

It arrived nine days before Christmas.

“I’m a good person,” the 58-year-old Giordano said in an interview, crying. “I worked hard. Isn’t having cancer enough?”

The crisis in American health care is not limited to hospital emergency rooms where uninsured people wait for care. It also is found in a neat, three-bedroom house in Dumont, N.J., occupied by a widow who worked full time, raised two kids and likes to get her nails done occasionally.

In less than a year, Giordano lost her health and her job. Now, she’s afraid she’ll lose her good credit and her health coverage.

In the lonely hours of the night, she said she thinks about giving up.

Giordano had health insurance throughout her illness. She didn’t have to beg for treatment and was not denied it. She loves the surgeon and oncologist and nurses whose care, she hopes, will give her many more good days with her first grandchild, born in July.

But she may be ruined financially. In this country, people can go broke if they get sick.

A cancer diagnosis “is a catastrophic double whammy” for many patients, said Blair Horner, an American Cancer Society vice president, “bad news on their health and potentially catastrophic news for their finances.”

Despite the passage of national health care reform in 2010, many of the changes intended to protect people from situations like Giordano’s haven’t been implemented yet.

Without a salary, she can’t afford to extend her coverage. She doesn’t know how she’ll pay off her hospital debt. She is desperate to keep her bills from going to a collection agency because a mark on her credit history could make it hard to buy a smaller place to live when she’s ready.

And then there’s the unsettling “activity” near her esophagus, spotted on a recent PET scan. Her doctors say it should be biopsied; Giordano says she can’t afford the copay and doesn’t want to hear more bad news.

“How does my body recover from chemotherapy with all this anxiety and stress?” she said.

“Bottom line? People can’t get sick. They can’t get cancer.”

Each week, more than 31,000 people are diagnosed with cancer nationally, according to the American Cancer Society.

Giordano’s Stage 2 lung cancer was detected when doctors ordered a scan for a lump that seemed perpetually stuck in her throat. Because she’s short, the imaging machine circled lower and inadvertently caught a picture of a tumor at the top of her lungs.

She was stunned. Afterward, she couldn’t find her car in the parking lot and didn’t know whom to call, her son or daughter. Their father, her husband, had died five years earlier of the same disease.

In July, a surgeon at Hackensack University Medical Center removed part of her left lung; she stayed in the hospital for six days. After her recovery, cancer-fighting drugs were pushed through a portal in her chest each week from August to December.

These treatments extend life for thousands of cancer patients. In 2000, the five-year survival rate for lung cancer patients was 25 percent higher than it was 20 to 25 years earlier. Giordano was told she had a 30 percent chance of living five years — more than twice what her husband had been told. Both of them had been smokers.

But the treatment is costly. Recurring charges for chemotherapy and/or weeks of daily radiation — combined with copayments for lab work and imaging to check progress — bury many cancer patients in medical debt.

Cancer “is one of the most expensive illnesses to have,” said Barbara Hoffman, founding chairwoman of the National Coalition for Cancer Survivorship and a law professor at Rutgers-Newark. “It results in a lot of personal financial stress and can lead to personal bankruptcy.”

Even when patients have coverage, they “may not be protected from high out-of-pocket costs when they are diagnosed with cancer,” according to a 2009 report by the Kaiser Family Foundation and the American Cancer Society. Along with high insurance premiums, those costs may force patients to pile up debt to pay for the care they need — or postpone or skip life-saving treatment.

“Having insurance increases people’s ability to access care,” said Mark Rukavina, an expert on medical debt and the executive director of The Access Project, a Boston-based health care advocacy group. “The good news is that they get the care, but the bad news is it’s unaffordable.”

As medical costs rise, employers have shifted more of the burden to employees through premiums, copayments and co-insurance.

“The days of Cadillac health plans are pretty much over,” said Peter Cunningham of the Center for Studying Health System Change in Washington.

Each year, an increasing share of Americans spend more than 10 percent of their income on premiums and out-of-pocket costs for health care, the standard used to define a “high medical cost burden,” he said. Surprisingly, that trend has “been increasing the most for people with employer-sponsored insurance,” he said.

It’s especially marked among small businesses, like the one for whom Giordano worked.

Premiums for New Jersey companies with fewer than 50 employees have climbed steadily, most recently by more than 10 percent from 2010 to 2011.

Giordano’s share of her medical expenses included: $125 for each same-day procedure, such as a biopsy or the implantation of her chemotherapy port; $100 for each MRI, CT or PET scan; $40 for each visit to the specialist; and $250 a day, to a maximum of $1,250, each time she was hospitalized. Her policy, from Oxford Health Plans, placed no limit on out-of-pocket expenses.

And she is one of the lucky ones. A growing number of New Jersey residents — more than one in eight — do not have health insurance at all.

“We’ve seen a pretty substantial erosion over the past 10 years in people who work for small employers who even have coverage from their employer,” Cunningham said.

Ellen Stovall, a three-time cancer survivor and senior adviser at the National Coalition for Cancer Survivorship, said survivors already face daunting choices as they make treatment decisions.

“The last thing they need is to worry about losing their health coverage or paying high cost-sharing or premiums,” she said. “Yet the fact is that … many Americans are underinsured — something they often don’t realize until they have a devastating diagnosis.”

Giordano worked until the day before her lung surgery in July. Then her income was slashed — from a monthly paycheck of $4,670 to a monthly disability check of $2,215, which ended in December.

With a mortgage payment of $1,700 and a $460-a-month car payment, disability didn’t go far.

The first hospital bill for $1,250 arrived, and Giordano didn’t have the mone
y to pay it.

She called the billing office and negotiated an $85-a-month payment plan.

Then Giordano came down with pneumonia and spent another week in the hospital. Again, her share was $1,250. Again, she didn’t have the money. And again, she asked for consideration: could she extend the $85 monthly payments for another 15 months?

The answer was no. A separate bill meant a separate payment plan, she said Hackensack’s billing department told her. She found the pressure to be intense.

“When people are stricken with a life-threatening disease, and they have copayments, and they call up in good faith — then they (hospitals) try to intimidate me?” Giordano said.

She finally worked out an additional $50 monthly payment plan. It was more than she could afford, she said, but she wanted to avoid going to collections.

After that, she said, she rarely left her house because she feared getting sick and needing to be hospitalized again.

More than one in five American families experience problems paying medical bills, the Center for Studying Health System Change reported in November. Some 44 million Americans are paying off medical debt, the Commonwealth Fund said, up from 37 million in 2005. Congress reported in 2010 that 30 million Americans of working age were contacted by a collection agency for unpaid medical bills.

One survey periodically asks people how they have been affected because of their medical bills. “Two-thirds of people say … they’ve had problems paying for some of the basic necessities — food, rent, mortgage, clothes, basic stuff,” Cunningham said. “They’ve put off major purchases. They’ve taken money out of savings or borrowed money. An increasing number consider filing for bankruptcy.”

In fact, medical bills and illness contributed to nearly two-thirds of all personal bankruptcies in 2007, a 50 percent increase over 2001, according to Steffie Woolhandler, a physician who co-authored several studies on health care debt. Most of those bankrupted were middle-class homeowners, she said.

“The overwhelming majority of those bankrupted by illness” had health insurance, she testified to Congress in 2009. “These families had done everything right. They worked hard, paid their premiums and thought they were covered. Yet when illness hit, they found themselves unprotected, ruined by copayments, deductibles and bills.”

The Affordable Care Act, if enacted as planned in 2014, is supposed to help these patients. One provision aims to make sure every health insurance plan delivers good value — “a better bang for the buck,” as one expert said — by requiring that 85 percent of the premium dollar go toward health care.

“Had she (Giordano) ended up without health insurance two years from now, there would have been a way to help her,” said Blair Horner of the American Cancer Society. Subsidies would be available to help purchase insurance coverage, he said.

Giordano knows what can happen if she doesn’t pay her hospital bills: She worked as a leasing agent for a property management company and regularly checked the credit histories of prospective tenants.

“That’s where I learned that medical bills can ruin your credit,” she said. “It shows up all over the report, automatically lowers your FICO score and instantly gives you bad credit.” She used to turn down potential tenants with bad credit. Some employers even check a potential employee’s credit history before offering them a job.

Medical bills account for more than half of all collection actions reported to consumer credit reporting agencies, a 2003 report by the Federal Reserve said.

Many of those bills are for less than $500, yet each one contributes to a poor credit score. A single surgery can generate separate bills from a surgeon, anesthesiologist, hospital, pathologist and other professionals, quickly overwhelming a sick person’s ability to understand and keep up. A dispute about whether a service is covered can leave the patient and insurer arguing while the hospital sends the bill to a collection agency.

“Once it goes to collections, even if paid promptly, it’s a stain on their credit report,” Rukavina, the expert on medical debt, said. “It can remain there for seven years, even with zero balance due. … Your credit score goes down and the cost of borrowing increases: It can cost tens of thousands of dollars on a mortgage.”

Some members of Congress became so concerned about the issue that a measure to change the reporting of medical debt by collection agencies was introduced last year with bipartisan sponsorship. It would exclude from credit histories medical debt that has been paid in full.

When Giordano dares to hope for a future after a full recovery, she talks about moving to a smaller place or a town house down the New Jersey Shore or to Florida. It would require a new mortgage “I care about my FICO score,” she said.

She couldn’t understand why the hospital wouldn’t set up a payment plan she could afford. “Anything I vowed to pay them, I’ve always paid them,” she said, referring to bills in the past for her husband and daughter. “I’m not asking for charity.”

To Robert Glenning, the chief financial officer at Hackensack University Medical Center, hospitals are no different than other businesses.

“The employees get paid every two weeks, the mortgage gets paid every month, the vendors want to get paid within 30 days,” he said.

Bills are issued to patients with the expectation of prompt payment. They’re told that upfront. Even when patients negotiate a payment plan, Hackensack, like most area hospitals, seeks payment in full within 12 months.

“The larger point is that there’s a problem nationally with health care,” Glenning said. “Singling out one hospital, one physician or one patient certainly highlights it but misses the point that it’s a national problem. It’s not that people don’t care around here or that people are deliberately being a Scrooge on it.”

No hospital could survive without collecting the portion of the bill that is the patient’s responsibility, he adds.

Despite the recession of the past two years, Hackensack has seen no surge in delinquencies or even an uptick in the number of insured patients having trouble paying their share, he said.

But other New Jersey hospitals report a different experience.

“Over half of our bad debt now is co-insurance and deductibles,” said Joseph M. Lemaire, the chief financial officer at Holy Name Medical Center in Teaneck. Five years ago, it was only 10 or 12 percent. “It’s a sign of the economy. … and the fact that employers are pushing more of the burden onto employees. People just can’t pay.”

Similarly, Anthony Orlando, CFO of Englewood Hospital and Medical Center, said “We’re seeing more bad debt from our insured population.”

And The Valley Hospital in Ridgewood also “has experienced an increase in people having difficulty paying their bills for quite some time,” said Ken Parker, a spokesman.

Most hospitals send unpaid accounts to collection agencies after three billing cycles, their executives said — unless a payment schedule has been set up. They haven’t varied the procedure because of hard economic times.

Giordano described the insistence of Hackensack’s billing office on a second monthly payment — even as she struggled to pay her first — as cold, heartless and rude.

Glenning challenged that characterization.

“We do extensive training of our staff,” he said. “It’s a very stressful time for the patients. They don’t know the certainty of their future. They’re getting bills and trying to work things out. Hospital billing is very complicated. Every health plan has its own rules, and every hospital has its own ap
plication of those rules.”

It’s understandable, he said, if patients become emotional.

Giordano had planned to celebrate the completion of her long, aggressive course of chemotherapy with her friends on Dec. 16. Instead, she opened the letter announcing that her job was gone.

The letter explained why her position couldn’t be held open. “Small companies … are not obligated to hold positions open for an employee on a leave of absence,” it said. The letter noted that the company had held her job for almost five months, which far exceeded its normal policy of 90 days’ medical leave.

However, the letter went on, “Because of our continuing concern for your welfare,” the company will extend and pay for her health coverage through April.

Giordano was devastated.

“Let me tell you something,” she said, “if the cancer didn’t kill me, this will.”

Her lustrous long brown hair had just begun to fall out. She was thin and easily winded but spoke furiously about the letter’s effect.

A generation ago, it was common for workers diagnosed with cancer to lose their jobs, said Hoffman, the Rutgers law professor. People with “the big C” weren’t expected to survive. There was no Americans with Disabilities Act. State anti-discrimination laws weren’t in place to protect cancer patients or those with chronic conditions.

But medical progress, new laws and a sea change in attitudes toward cancer survivors have greatly reduced the instances of discrimination, she said. Disabled employees now have a right to reasonable accommodation for their disability when their employer is covered by federal and state disability law. Small firms are exempt from the ADA, but not the New Jersey law.

Giordano responded to the letter fiercely, with a round of telephone calls to anyone who might be able to help. Then, her immune system weakened by the chemotherapy, she developed an infection and a fever. Christmas, even with a 6-month-old grandson, was ruined.

“I feel broken inside,” she said. “You’re fighting one thing, and you sort of conquer that journey, and this happens. … Who do you think is going to hire a 58-year-old woman?”

She has received the last of her disability checks. She is waiting for a state determination of whether she’s eligible for unemployment pay.

With no income, she doesn’t have the money to extend her health coverage; the subsidies through the Affordable Care Act to buy insurance won’t begin for two years.

Her doctors want her to have further tests, but she can’t afford the copays. And, frankly, she doesn’t want to know the results.

“Don’t sugarcoat this,” she said. “You know my husband died from this. I came to the end of one part of my journey, now I’m on another part. I don’t know what’s next.”

She fingers her rosary beads — at this point, her only source of strength, she said.

“If I succumb to this,” she said, she doesn’t want people to send flowers or donate to cancer research.

“I’d want a relief fund started — something where, if somebody’s in trouble with a copay, or needs a scan, or somebody’s in trouble with their rent or mortgage, they’d have some help. It would be one less thing to worry about, and they could just focus on getting better.”

———

SQUEEZED BY HEALTH BILLS

Problems with medical bills or accrued medical debt increased, 2005-10:
Percentage of adults ages 19-64, 2005: vs. 2010
In the past 12 months:

Had problems paying or unable to pay medical bills: 23 percent (39 million) vs. 29 percent (53 million)
Contacted by collection agency for unpaid medical bills: 13 percent (22 million) vs. 16 percent (30 million)
Had to change way of life to pay bills: 14 percent (24 million) vs. 17 percent (31 million)
Any of the above bill problems: 28 percent (48 million) vs. 34 percent (62 million)
Medical bills being paid over time: 21 percent (37 million) vs. 24 percent (44 million)
Any bill problems or medical debt: 34 percent (58 million) vs. 40 percent (73 million)

Source: The Commonwealth Fund Biennial Health Insurance Surveys (2005 and 2010)

———

FACTS BEHIND MEDICAL DEBT

— 62.1 percent of all bankruptcies have a medical cause.
— Most medical debtors were well-educated and middle class; three-quarters had health insurance.
— The share of bankruptcies attributable to medical problems rose by 50 percent between 2001 and 2007.

Source: “Medical Bankruptcy in the United States, 2007: Results of a National Study,” by David U. Himmelstein, et al., in the American Journal of Medicine, August 2009

———

COSTLY BURDEN

More adults are spending large shares of income on out-of-pocket medical expenses, 2001-10. (See note.)

Percentage of adults ages 19-64 who spend 10 percent or more of household income annually on out-of-pocket costs and premiums (See note.)
2001 vs. 2005 vs. 2010

Total:
21 percent vs. 23 percent vs. 32 percent
Insured all year:
19 percent vs. 23 percent vs. 31 percent
Uninsured during year: 27 percent vs. 22 percent vs. 35 percent

(Note: Respondents who specified income level and private insurance premium/out-of-pocket costs for combined individual/family medical expenses.)

Source: The Commonwealth Fund Biennial Health Insurance Surveys (2001, 2005 and 2010)

Lindy Washburn is a staff writer at The Record in Hackensack, N.J., where an earlier version of this article appeared on Jan. 21.

http://www.therepublic.com/view/story/HEALTH-CNS-MED-MEDICAL-DEBTS_7123818/HEALTH-CNS-MED-MEDICAL-DEBTS_7123818/

The Record (Hackensack, N.J.), Jan. 21, 2012

Shocking injustice in health care

By Thomas Clairmont, M.D.
Letters, Portsmouth (N.H.) Herald, Jan. 27, 2012

Celebrating Martin Luther King Jr. Day should lead us to review some of what this great man said. Let’s review three of his quotes:

“Of all the forms of inequality, injustice in health care is the most shocking and inhumane.” With 65,000 Maine citizens about to be ejected from their Medicaid insurance, and 3,500 New Hampshire citizens with Medicaid eliminated from practices at Lakes Region Hospital, the time is long past to solve injustice in health care. You wouldn’t know it from the recent primary, where the only “plan” to help you with health care was to repeal President Obama’s Affordable Care Act and replace it with … nothing.

“The time is always right to do the right thing.”

Dr. Wennberg at Dartmouth has shown a way to “cut costs by 40 percent, enough to cover every uninsured person in the United States.” Dr. Himmelstein of Physicians for a National Health Program has shown that “if we cut our bureaucratic costs to Canadian levels, we’d save nearly $400 billion annually — more than enough to cover the uninsured and to eliminate co-payments and deductibles for all Americans.” Harvard Economics Professor Hsaio demonstrates “our research and analysis shows that a single-payer system can immediately reduce health care costs in Vermont by 8 percent to 12 percent and reduce health care costs by an additional 12 percent to 14 percent over time.” Why isn’t saving money, covering you and your family and covering your neighbors the right thing to do?

“The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy.”

Our group says that health care is a human right and every citizen should be fully covered. How about you?

Thomas Clairmont, M.D., is a member of Physicians for a National Health Program. He practices internal medicine in Portsmouth.

http://www.seacoastonline.com/apps/pbcs.dll/article?AID=/20120127/OPINION/201270389/-1/NEWSMAP

GAO report on Medicare Advantage risk adjustment

Medicare Advantage: CMS Should Improve the Accuracy of Risk Score Adjustments for Diagnostic Coding Practices

GAO
January 2012

We found that diagnostic coding differences exist between MA plans and Medicare FFS and that these differences had a substantial effect on payment to MA plans. We estimated that risk score growth due to coding differences over the previous 3 years was equivalent to $3.9 billion to $5.8 billion in payments to MA plans in 2010 before CMS’s adjustment for coding differences. Before CMS reduced 2010 MA beneficiary risk scores, we found that these scores were at least 4.8 percent, and perhaps as much as 7.1 percent, higher than the risk scores likely would have been as a result of diagnostic coding differences, that is, if the same beneficiaries had been continuously enrolled in FFS. Our estimates suggest that, after accounting for CMS’s 3.4 percent reduction to MA risk scores in 2010, MA risk scores were too high by at least 1.4 percent, and perhaps as much as 3.7 percent, equivalent to $1.2 billion and $3.1 billion in payments to MA plans.

http://democrats.waysandmeans.house.gov/media/pdf/112/gao_macodesfinal.pdf

Comment: 

By Don McCanne, MD

One of the greatest abuses of the private insurance industry is taking advantage of favorable selection. Through deceptive practices such as selective marketing, they enroll healthier individuals while receiving higher premiums appropriate for a less healthy population.

To correct for this, payment is modified through risk adjustment (RA) – reducing payments for healthier populations and increasing payments for less healthy populations. If health care spending is to be equitable, risk adjustment is mandatory in a multi-payer system such as that of the Affordable Care Act.

We now have considerable experience with risk adjustment between the private Medicare Advantage plans and the public fee-for-service Medicare program. The experience is not good. As Medicare has refined the risk adjustment tools, the private Medicare Advantage plans have found new ways to game the system which have resulted in even greater overpayments for their patients who are healthier than the data submitted by the insurers would indicate.

This GAO report recommends that Medicare needs to increase its data collection and revise its application of risk adjustment in an attempt to recover some of the overpayments that would be made in the future. However, the experience to date indicates that the private insurers will use the greater complexity to further game the system to their own advantage.

PNHP co-founders Steffie Woolhandler and David Himmelstein state it well in this comment on risk adjustment:

“RA (risk adjustment) folks have been making this claim for decades; great improvement is just around the corner. To us, the most interesting part of the 2004 enhancement of Medicare Advantage RA is not that plans beat it, but that the gaming was actually much more lucrative AFTER the enhancement than before. Static analyses of RA schemes can virtually always come up with schemes that explain far more of the variance than existing schemes – ie. they’re better. But once incentives are based on a particular RA scheme, the gaming is on. There is absolutely no evidence that RA works or can work in the dynamic reality of profit-seeking health care insurers/providers.”

Private insurers operate on market principles. They will always place business interests first. They chase the money.

A universal public insurance program operates in the interests of patients. Gaming risk adjustment is a totally foreign concept to administrators of a single payer system.

Why would we ever want to have private plans involved at all? Dump them and we’ll get rid of the problems of adverse selection and favorable selection. Keep them and they’ll always game the system. They win, and we lose.