PNHP

Vt. lawmakers resolve immigrant health care issue

Vt. lawmakers resolve immigrant health care issue

By Dave Gram
Forbes, May 3, 2011

MONTPELIER, Vt. (AP) — Vermont Senate negotiators dropped an amendment to bar illegal immigrants from coverage under a new state health care program, delivering a victory Monday evening to human rights activists who had rallied repeatedly at the Statehouse to demand the change.

Instead, the three senators serving on a House-Senate conference committee suggested studying the issues surrounding providing health care to an estimated 1,500 to 2,500 undocumented farmworkers in the state, as well as others in Vermont illegally. Their House counterparts readily agreed to the proposal.

The fight over coverage for illegal immigrants was a late-session storm in otherwise smooth sailing for the centerpiece of Gov. Peter Shumlin’s legislative agenda: a publicly financed, universal health care system that had broad support from Shumlin’s fellow Democrats who control both houses of the General Assembly.

After the Senate last week adopted the amendment proposed by Sens. Randy Brock, R-Franklin, and Richard Sears, D-Bennington, activists with the Health Care is a Human Right Campaign of the Vermont Workers’ Center, who had been providing strong grass-roots support for the health reform measure, turned on the senators.

Brock continued to defend his amendment Monday night, arguing that it is in keeping with federal law, and that if Vermont wants the federal permissions it needs to pursue its envisioned health system reform, it can’t flout federal immigration law.

“It’s clear we need a federal immigration policy that makes sense, and we need a guest worker program,” Brock said. “But it’s also clear that Vermont cannot and should not provide insurance coverage to people who are not here lawfully.”

Brock is not on the conference committee, and the senators who are showed their willingness to jettison his and Sears’ amendment under pressure from the activists.

Sen. Claire Ayer, chairwoman of the Senate Health and Welfare Committee and the leader of the Senate conferees, read from proposed legislative findings that pointed out apparent contradictions in federal law:

“Federal law requires certain health care providers to provide emergency treatment to all individuals, regardless of immigration status. Federal law prohibits coverage of undocumented immigrants through Medicaid and through the Exchange,” a new health insurance marketplace that the Vermont bill calls for setting up, in keeping with the federal health care law passed last year, the proposed findings said.

The Senate proposal called for asking the Green Mountain Care Board, which already is to conduct several other studies to get the state ready for universal health care, to add the immigration issue to its list.

House conferees quickly agreed.

“The human rights perspective certainly is a worthy one,” Rep. Michael Fisher, D-Lincoln, vice chairman of the House Health Care Committee and a member of the conference committee, said in an interview shortly after Monday evening’s session. “There’s also financial issues that warrant our attention, and legal ones.”

http://www.forbes.com/feeds/ap/2011/05/03/business-us-vt-health-care-immigrants_8446801.html

Previously:

Activists decry exclusion of undocumented workers from Vermont’s H.202

By Anne Galloway
Vtdigger.org, May 2, 2011

An undocumented Mexican migrant worker named Javier wouldn’t give his full name or say what county he lives in for fear of deportation. In spite of his apprehensions, however, he stood in front of the Statehouse on Sunday and told a crowd of May Day activists that the health care reform bill they had worked hard to support included a provision that discriminates against undocumented workers. Javier’s remarks were translated by an interpreter.

“This amendment appears to be a discriminatory act to exclude us from the health care proposal,” Javier told the crowd.

Javier, who has farmer’s lung, said he would not be able to receive medical attention if H.202 passes because he would not be able to afford to pay for his care out of pocket. Doctors have suggested that he undergo testing because they suspect he has fibrosis. Javier said the expense makes further diagnosis impossible.

The Vermont Farmworker Solidarity Project and the Vermont Workers Center has organized a lobby day today to pressure lawmakers to reverse the amendment, which they say runs counter to the fundamental principles of health care for all. They are also holding a press conference on the Statehouse steps to make their case to reporters at noon on Monday.

About 1,500 to 2,000 undocumented dairy workers from Mexico are employed by Vermont farmers and they are credited with helping to keep the dairy industry solvent at a time when few Vermonters are willing to work on farms.

Universal health care means universal, David Karindler, an organizer with the center, said.

“This is the first time such hateful language has been put in legislation,” Karindler said. “We’re all about inclusion in this state. This is the first time exclusion has become part of a bill. This is about undocumented people flocking to the state. Why would they flock to a place with no housing and no jobs?”

The Senate amendment to H.202, the universal health care bill, limits access to the state’s insurance exchange, which goes into effect in 2013, and Green Mountain Care, the single-payer system which could be implemented as early as 2014, to Vermont residents. Under the provision, individuals in the exchange are “reasonably expected to be during the time of enrollment, a citizen or national of the United States or a lawfully present immigrant in the United States as defined by federal law.”

The amendment is based on federal requirements under the Affordable Care Act, which restricts access to the state’s health care exchanges to legal residents of the United States. The Brock-Sears amendment would make it illegal for the state to provide federal funding for care through the exchanges. As it stands now, Medicaid money cannot be used to provide health care for undocumented residents. Legislative lawyers are re-evaluating the legal repercussions of the language in the amendment, according to Senate President Pro Tem John Campbell, D-Windsor.

“I doubt people are going to be moving up here,” Campbell said. Vermont already has more generous Medicaid benefits than those offered by other states and that fact hasn’t led to an influx of people to moving here, he said.

Senate Democrats voted overwhelmingly for the amendment in a 22-8 vote after Sen. Claire Ayer announced that the Senate Health and Welfare Committee had reviewed the amendment and took no position on it. Ayer later voted for the amendment, along with Sen. Tim Ashe, P/D-Burlington, and because they were called on first to vote (the roll call is given in alphabetical order), one observer speculated that this signaled a green light to other Democrats in the chamber. Campbell also voted yes.

James Haslam posted a statement about the vote on the left-leaning blog Green Mountain Daily last week that sparked a fierce debate in which the word “racist” emerged.

Campbell said there was some confusion in the Senate about the amendment. For that reason, he asked Shumlin administration lawyers to review the language and they gave senators the go-ahead.

“It came down a lot of things happening last week,” Campbell said. “This was not something on anyone’s radar until we saw the amendment with the assurance of certain individuals. You put faith and trust in that. If it’s determined to be a mistake, then as far as I’m concerned I’ll take the heat on that go ahead and cha
nge it. I don’t think Dick Sears or Randy Brock are racists or trying to be Arizona-like in their development of the law.”

Campbell described the provision as belt-and-suspenders legislation – essentially a restatement of the federal law.

Activists question why the amendment is necessary if it’s part of the federal law.

Karindler said Sen. Randy Brock, R-Grand Isle-Franklin, went out of his way to redefine what a resident was.

“It was strategic in its divisiveness,” Karindler said. “To suddenly frame things around undocumented workers seemed calculated.”

Peg Franzen, president of the Vermont Workers Center, said she thought the Senate debate on the amendment got confusing.

“We’re hoping people understand what it actually means,” Franzen said. “It actually refers to Green Mountain Care, which would not be set up until 2014 or 2017.”

Freshman Sen. Philip Baruth, D-Chittenden, who voted against the amendment, said it’s unfortunate that the attention is focused on the amendment when Senate Democrats evinced, “hard core serious unity” around support for H.202.

“I’m discouraged that this one stray amendment is now the story as though it’s indicating fractures in Democratic lines,” Baruth said. “It’s a shame. Instead of a victory lap we’re now in a simulated crisis. I don’t think it’s a crisis. It’s a bump and we will fix it. I hope people who voted for this will get a chance to vote for (the amendment) without it. There are people who did yeoman’s work on this bill who are being unfairly demonized in some quarters. It’s a shame all around that a victory lap morphed into something far less positive.”

Rep. Mark Larson, D-Burlington, and chair of the House Health Care Committee, said lawmakers will likely re-examine the amendment as part of a larger review of the legislation during the conference committees, which take place on Monday starting at 10 a.m., 1 p.m. and 4 p.m.

Larson is also dismayed by the turn of events.

“My focus is on trying to create a health care system that works for our state and I don’t want to get into a focus on whether my senate colleagues are racist or not,” Larson said. “I appreciate why people are upset about the amendment and the significance the issue has in terms of whether all people will be covered by Green Mountain Care. I also understand that national immigration policy isn’t very helpful at this point.”

In the past, Vermont used state dollars to cover health care costs for undocumented farm workers, according to Larson. Under federal rules, Medicaid money can’t be used. That policy would carry through under Green Mountain Care, Larson said, because part of the funding for the single-payer system would come from Medicaid. The state would have to come up with an alternative funding source. Currently, farmers, federal health centers and volunteer groups help workers with care, though in some cases health care providers end up shifting the cost to other patients.

http://vtdigger.org/2011/05/02/undocumented-workers-excluded-from-h-202/

Doctors order: Fix health care

After 22 years, someone might be listening

By Dave Gram
Greenfield (Ind.) Reporter, May 1, 2011

MONTPELIER, Vt. (AP) — Even now, Dr. Deb Richter is haunted by images of some of the patients she saw at inner-city clinics where she worked in Buffalo, N.Y., during the 1980s.

One young man without health insurance didn’t get the early intervention he needed for diabetes. He went blind, got an infection and died at 21. His sister, who also had lived with juvenile diabetes, delivered a baby three months premature. The baby died. Two years later, the 25-year-old woman suffered a heart attack and died during coronary bypass surgery.

“I had patients who were dying at young ages of preventable diseases,” Richter said.

One common symptom: Lack of health insurance.

The experiences prompted Richter, 55, to become an activist. She joined Physicians for a National Health Program. After moving with her family to Vermont in 1999, she continued to pursue her goal of a publicly financed universal health care system.

Richter watched last week as the Vermont Senate voted 21-9 to pass a bill setting the state on a path toward the universal, unified health care system that, she and other backers say, will take administrative costs and insurance company profits out of health care, cover all Vermonters — including the 45,000 now without health insurance — and save the state money.

“This is a step in the right direction — finally,” Richter said after the Senate vote on legislation previously passed by the House. “This is the first time a state is actually establishing a true health care system, where everyone will be included. It’s going to have a budget. We’re going to have uniform payments, which will help reduce administrative costs.”

Richter came on the Vermont scene not long after an effort to bring about universal health care in the 1990s fizzled, and she quickly began trying to make political contacts.

She found it a lot easier in a state of 620,000 — she met fellow physician Gov. Howard Dean at a chicken dinner in Barre — than in New York, with its population of nearly 20 million, where she couldn’t get a meeting with her state representative.

She traveled around Vermont, giving more than 400 talks to Rotary Clubs, Chambers of Commerce and other groups.

She offered dramatic Statehouse testimony when she and a friend unfolded a list of the addresses of insurance companies and government insurance programs to which her five-doctor medical practice in Cambridge had to send bills.

The list was 190 pages long.

Even some of those who voted against the health care bill that passed last week credit Richter for her persistence.

“She began to advocate for a single-payer system soon after the last effort collapsed (in the 1990s), and oftentimes was a lone voice in the wilderness,” said Sen. Vincent Illuzzi, R-Essex-Orleans.

Those who share Richter’s support for a single-payer system sing her praises.

“The fact that we are as close as we are to passing a single-payer health care bill in Vermont is a tribute to a lot of grassroots work, but Deb Richter is the backbone of that work,” Gov. Peter Shumlin said. “She’s a doctor who practices every day, sees what’s wrong with the system and wants to right it. … She’s tenacious. She’s smart. She’s tough.”

The bill passed by the House and Senate would set up a new clearinghouse for health insurance policies in Vermont called an “exchange,” meeting a requirement that states establish such entities laid out in the federal health reform law passed last year.

It also would set up a new Green Mountain Care Board to set parameters for what health benefits would be offered. The administration would be responsible for coming up with a way to pay for the new system by January of 2013. A legislative consultant recommended a new payroll tax shared by workers and employers.

Not everyone agrees the bill goes far enough. Physicians for a National Health Program, the group Richter joined 22 years ago, said the bill stops well short of its goal of single-payer health care because it would still allow multiple insurers to operate in the state.

“The Vermont plan promises a public program open to all residents of the state in 2017, but even then it would allow a continuing role for private insurance,” the group said in a statement. “This would negate many of the administrative savings that could be attained by a true single-payer program, and opens the way for the continuation of multi-tiered care.”

Richter, though, says the bill puts Vermont on a path to real progress. “They want to get to the top of the mountain in one step. I’m willing to take smaller steps. … We just disagree.”

Richter said she has learned an important lesson during her years of advocacy. She began by seeing health care as a moral issue, but came later to believe that the way to get people to change their minds about it was to get to them through their wallets, rather than their hearts.

James Haslam, coordinator of the Health Care Is A Human Right campaign at the Vermont Workers’ Center, called Richter “awesome.” He said the work of Richter and her group Vermont Health Care for All and that of the Workers’ Center were complementary.

Richter’s strength is “particularly bringing voice on this issue to providers, to other doctors and also to the business community. She’s incredibly gifted at reaching them and going to where they’re at. We’ve been more focused on ordinary Vermonters and working-class folks,” Haslam said.

Richter said she strives for a practical approach that will appeal to all audiences. The health care system is like the fire department, she says — something people don’t want to use, but want in place, just in case.

Most people’s first impulse is to say, “You don’t want to pay for Joe,” and his hospitalization, Richter said. “But Joe’s in the bed you’re going to be in tomorrow. That’s why we have to have health care as a public good.”

http://www.greenfieldreporter.com/view/story/f5a45f862d644e4e8749aebde9ca954f/VT–Health-Care-Crusader/

Canadian health care misstated

Dr. Francis Pasley
Letters, Burlington Free Press, May 2, 2011

I am a medical doctor, semi-retired living in Vermont and having a limited practice. Prior to moving to Vermont two and a half years ago I practiced full time, dividing my practice between the Detroit area in Michigan and Windsor, Ontario, an hour drive from Detroit. Thus I have a substantial personal knowledge of medical practice in the USA and Canada.

I have been distressed to hear opinions by Vermont medical professionals and local conservatives about the poor care available in Canada, especially long waiting times for care, and the negative feelings of physicians who have moved here from Canada about the experiences they have had practicing medicine in Canada, suggesting no one would stay there by choice.

I moved to Vermont for family reasons and not to leave practice in Ontario, Canada. Indeed if I were younger I would far rather return to practice in Canada. Caring for patients without having to worry about their ability to afford medical care far outweighed any negatives. I knew doctors who chose to practice in Canada rather than the United States for the same reason. Some who trained in the U.S. and elected to locate in Canada.

In my opinion the waiting list issue is manufactured by people who wish to discredit a system that cares well for everyone with some minor inconveniences rather than one that denies care to millions while admittedly providing exceptional care to those well able to afford it. For those with urgent needs and serious medical problems, in my experience the care in Canada is equally exceptional and prompt.

The issues relating to medical care in every country are enormous and to raise concerns about waiting or the personal preferences of a few physicians trivializes it. We must rather decide what sort of society we wish to live in, what level of support we owe to all in our society, to whom we choose to deny adequate nutrition or healing efforts so that the privileged will be denied nothing or whether we choose to provide basic adequate sustenance to all. Hopefully we will choose the latter and then face the difficult task of defining what represents basic adequate sustenance.

Dr. Francis Pasley of Williston is a member of Physicians for a National Health Program.

http://www.burlingtonfreepress.com/article/20110501/OPINION02/105010333/My-Turn-Canadian-health-care-misstated

The Push to Enact Medicare Reform

Letters
The New York Times, May 1, 2011

There is a “real choice on Medicare” (editorial, April 24) just not within the narrow confines defined by the deficit zealots inside the Beltway or in editorial offices.

The G.O.P.-Ryan plan is little more than a thinly veiled scheme to destroy one of the most fundamental reforms in American history through privatization and further cost-shifting to many of the most vulnerable in our society.

But the White House plan also fails, through a reliance on a health care law that expands the role of private insurers while taking inadequate steps to rein in price-gouging by the private insurers that ultimately puts cost pressures on Medicare as well.

The “real choice” would be securing the future of Medicare once and for all by extending it to cover everyone. Through its proven formula of global budgeting and federal bulk-purchasing power, it is the best way to effectively control costs while ensuring that we change our broken health care system from one based on ability to pay to one based on patient need.

ROSE ANN DeMORO
Executive Director
National Nurses United
Oakland, Calif., April 25, 2011

Further comment by Uwe Reinhardt on queues in Canada

The last Quote of the Day discussed Princeton Economics Professor Uwe Reinhardt’s New York Times blog entry on rationing in Canada and the United States. I (Don McCanne) wrote a response to his article, and he responded to my comments. That response follows.

The New York Times
Economix

Uwe E. Reinhardt
Daily Economist
April 29th, 2011

Len Charlap’s Comment No. 27 requests that I respond to Comment No. 9 by Don McCanne, even though Dr. McCanne did not explicitly called for a response.

I agree with Dr. McCanne that the role of queues can easily be misunderstood.

Given a naturally or artificially limited supply of a thing, queues arise when money prices are not allowed to rise to levels that shrink the demand for the thing to match the available supply. Other prices – e.g., the price of time (e.g., waiting in a doctor’s office) or discomfort prices (the disutility of having to put up with a physical impairment while waiting) then do the equilibrating.

In the case of naturally limited supplies – e.g., supplies of transplantable organs – neither of these prices equilibrates demand and supply and some administrative mechanism of rationing occurs. My former Princeton student, later leader of the U.S. Senate and then my co-teacher of a course on health policy at Princeton, told us how that works. It is less than perfect.

In the case of artificially limited supplies, one way to reduce the time-and–discomfort prices is simply to expand the supply of the artificially limited supply.

It is true that in the past I have criticized Canadian policy makers for not doing so. They responded that they are actually quite concerned over the issue and, in fact, have sought to understand the nature of their queues better through one (or perhaps even two) Royal Commissions on queues in health care.

Since that time, they have worked on what they call “evidence-based queuing,” that is, a form of queuing that uses queuing theory and seeks to minimize the physical harm of queuing, giving serious cases faster access than is available to less serious cases.

My Canadian colleagues tell me what Canadians do not want to do is to have their supply side driven by entrepreneurial forces that can easily flood the market with excess capacity and drive up costs. They cite the huge American literature on the excess use of imaging in the US as example.

Similarly, my Canadian colleagues tell me that what Canadians do not want to do is spend 17% (soon going on 20%) of the GDP on health care, especially when there is no evidence that it begets better overall health statistics (and often worse statistics), greater patient satisfaction, and moreover leaves millions of citizens without health insurance and spotty access to care, not even to speak of financial distress.

It is not hard to sympathize with them on that view.

http://community.nytimes.com/comments/economix.blogs.nytimes.com/2011/04/29/does-the-ryan-plan-curb-health-spending/?permid=9#comment9

Health-Care Reform Act Assailed

McClatchy-Tribune Information Services
April 29, 2011

April 29–Congress caved into corporate interests last year to enact a health care policy that will leave millions of Americans without insurance, do nothing to rein in rising costs and put everyone at the mercy of an unfair, for-profit system, a national advocate for a single-payer health system said in Albuquerque.

“We need a system,” Margaret Flowers, a Maryland-based congressional fellow with Physicians for a National Health Program, told the New Mexico Public Health Association convention in Albuquerque this week. “We don’t have a system. We don’t allocate resources in a rational way. We ration care in the cruelest way, on the ability of the patient to pay.”

Flowers, a pediatrician who left practice in 2007 to work on health reform issues, said health policy “is part of a greater social justice movement” that should fight for better education, jobs, decent housing and a cleaner environment for everyone.

Corporate interests, abetted by corporate-controlled media, kept a single-payer solution from being discussed during the debate the led to the passage of the Affordable Care Act in 2010, Flowers said, adding that the evidence shows such a system provides better patient care at a lower cost than an insurance-based, for-profit payment system.

Medicare and Medicaid are victims of out-of-control costs that ACA will only make worse, she said. The law will raise costs with new insurance exchanges, more regulations on insurance companies and an increased role for the Internal Revenue Service, which will have to enforce mandatory coverage rules scheduled to take effect in 2014, Flowers said.

If corporations paid taxes on operations they move off shore, revenues will be more than enough to fund those programs, Flowers said. “Austerity measures are not necessary,” she said.

http://insurancenewsnet.com/article.aspx?id=258535

Insurers Getting Rich By Not Paying for Care

By Wendell Potter
PR Watch, April 25, 2011

If I had stayed in the insurance industry, my net worth would have spiked between 4 p.m. Wednesday and 4 p.m. Thursday last week — and I wouldn’t even have had to show up for work.

I’m betting that just about every executive of a for-profit health insurance company, whose total compensation ultimately depends on the value of their stock options, woke up on Good Friday considerably wealthier than they were 24 hours earlier. Why? Because of the spectacular profits that one of those companies reported Thursday morning.

Among those suddenly wealthier executives, by the way, are the corporate medical directors who decide whether or not patients will get coverage for treatments their doctors believe might save their lives.

UnitedHealth Group, the biggest health insurer in terms of revenue and market value, earned so much more during the first three months of this year than Wall Street expected that investors rushed to buy shares of every one of the seven health insurers that comprise the managed care sector. In my view, it would be more accurate to call it the managed care cartel.

UnitedHealth is always the first of the big seven to announce earnings every quarter, so investors consider it a bellwether. If UnitedHealth exceeds Wall Street’s expectations, as it has been doing consistently, investors assume that the other six will do likewise. Sure enough, all seven — Aetna, CIGNA, Coventry, Health Net, Humana, UnitedHealth and WellPoint — saw their stock prices close Thursday afternoon at or near 52-week highs.

UnitedHealth’s shares shot up more than 8 percent during the day. Increases of that magnitude are so rare that I could almost hear the champagne corks popping in the Minnetonka, Minnesota office of UnitedHealth’s CEO, Stephen J. Hemsley.

Wall Street analysts had worried that health insurers would have such a hard time complying with the provisions of the year-old health care reform law that their profit margins would decline. Those concerns were put to rest when UnitedHealth reported that its operating margins were “stable” at 8.7 percent in the quarter. The company’s stellar performance should also put to rest — forever — the myth that “ObamaCare” is “bleeding insurers dry,” as industry apologist Sally Pipes contended in a Feb. 24 commentary in Forbes.

Noting that UnitedHealth’s 13 percent increase in profits prompted the company to raise its full-year earnings forecast, the Minneapolis Star Tribune opined, “Life under new health care reform laws may not be so rough after all.”

Indeed. Consider these numbers: UnitedHealth’s profit during the first three months of this year increased to $1.35 billion from $1.19 billion a year ago. When you do the math to determine the company’s earnings per share, the result is nothing short of jaw-dropping. On that basis, UnitedHealth’s profit jumped from $1.03 to $1.22 per share. Wall Street analysts had been expecting the company to earn just 89 cents a share. When you beat Wall Street’s expectations by 33 cents a share, you have accomplished something that most CEOs can only dream about.

UnitedHealth’s CEO at Top of Forbes 2011 Executive Pay List

Speaking of CEOs, Stephen Hemsley in particular made out like a bandit Thursday. Already at the very pinnacle of Forbes 2011 “Executive Pay List” (you read that right, his total compensation of $101.96 million last year made him the highest paid corporate executive in the United States of America), Hemsley saw his net worth skyrocket last week.

Of that $101.96 million Hemsley “earned” last year, $98.55 million came from stock gains, mostly from exercising options. And that doesn’t even count the value of stock options he hasn’t yet cashed in. According to published reports about the company’s Securities and Exchange Commission (SEC) filings, the total value of the options Hemsley had not exercised by the end of last year totaled almost $745 million. Considering the fact that the price of UnitedHealth’s stock has increased by more than $20 per share in just the last nine months, you can be pretty certain that Hemsley is now sitting on a stash of options worth well over $1 billion. That doesn’t count the shares of UnitedHealth stock Hemsley owns outright, the value of which was estimated to be $111.4 million at the end of 2010 and which, of course, is much higher now.

As you can imagine, Hemsley and other UnitedHealth executives were peppered with questions during the company’s conference call with Wall Street analysts last Thursday. They wanted to know how UnitedHealth had pulled off such a stunning accomplishment.

As it turned out, they pulled it off by paying far fewer medical claims than anyone had expected. That in and of itself is not new. Last year was one of the industry’s most profitable years because, the big insurers insisted, their policyholders had not needed to go the doctor or check into the hospital as much as they had in the past. Consequently the insurers did not have to pay as many claims. The reason they gave was that the flu season last year was much less severe than predicted.

Insurers Mum on What’s Really Making Their Profits Skyrocket

Well, it turns out that dog won’t hunt anymore. UnitedHealth executives admitted during the call with analysts Thursday morning that “the incidence of influenza was substantially higher this quarter than last year.” So, even though more people had to be treated for the flu during the first three months of this year than UnitedHealth had expected, the company still managed to spend less on medical claims during the quarter than investors had expected.

Not being able to attribute the unexpected decrease in medical spending to a mild flu season this time, Hemsley and his colleagues said it was because of the unexpected decrease in stormy weather.

I’m not making this up. They blamed the company’s good fortune on “the effect of severe consistent winter weather conditions across significant portions of the country.”

Veteran analyst Christine Arnold of Cowen and Company apparently wasn’t buying it, so she pressed for more “clarity” during the call.

“Excluding places where you saw winter storms,” she asked, “was utilization (of health services) up?”

Earlier in the call, the executives seemed to be suggesting that the number of inpatient hospital “bed days” was down considerably because of bad weather.

“So, excluding storms,” she probed, “were bed days up?”

UnitedHealth’s chief financial officer, Dan Schumacher, finally had to ‘fess up.

“Bed days excluding storms were flat to slightly down depending on the geography,” he replied.

In other words, it wasn’t the stormy weather after all. Unfortunately, Arnold did not press further (“OK. That’s helpful. Thanks,” she said) and no one asked the logical follow-up question: “Well, then, what was it?”

Insurers Pinch Policy Holders for Higher Premiums and Out-of-Pocket Costs

Contrary to what insurance company bigwigs try to make us believe, it is not snow, sleet and freezing rain or mild flu seasons that enables these companies to blow Wall Street’s estimates out of the water. What they will not admit is that their companies are making record profits by pushing more and more of us into benefit plans that require us to pay a whole lot more out of our own pockets before they will pay anything for our medical care.

And I’m betting that if the insurers had to disclose their rates of claim denials and the number of procedures their medical directors are refusing to pay for, we would see that those numbers are increasing, and maybe substantially. Medical directors know they play a key role in meeting Wall Street’s expectations, and they’re rewarded with raises, bonuses and, yes, stock options, if management is pleased with their job performance. The less money these co
mpanies pay out for care, the more is left over to reward shareholders and a bunch of corporate executives.

This is why, folks, that “utilization” is down. Growing numbers of people who have insurance, who are paying hard-earned money every month for coverage that is increasingly inadequate as well as expensive, simply can’t scrape up enough cash to go to the doctor or hospital or, in many cases, even pick up their prescriptions.

That is a trend that the insurers are determined to continue. And while we are being forced to go without necessary care and empty our pockets to pay our premiums, insurance company billionaire Stephen Hemsley and his cohorts are stuffing their pockets — with our money.

http://www.prwatch.org/news/2011/04/10665/insurers-getting-rich-not-paying-care

Health Execs Getting Richer As Some Americans Beg for Help to Pay for Care

By Wendell Potter
The Huffington Post, April 28, 2011

On Monday, I wrote about the good fortune of UnitedHealth Group, one of the big seven for-profit health insurance companies, and its CEO, Stephen J. Hemsley. Last week, UnitedHealth pleased Wall Street so much with its report of earnings during the first three months of this year that investors clamored to buy the company’s stock.
 
By the time the New York Stock Exchange closed last Thursday, shares of UnitedHealth’s stock had shot up more than 8 percent and reached their highest value in more than three years. The company’s shareholders, including Hemsley, now the highest paid CEO in America, were suddenly much wealthier.
 
Owners of health insurance company stock continued to get richer this week. On Tuesday, Humana Inc. announced that its first quarter earnings would be so much better than Wall Street expected that it was raising its full-year profit outlook and instituting a dividend. The company’s stock price jumped 5.5 percent after disclosing that fabulous news.
 
The good news, at least for shareholders, just keeps on coming. This morning, Aetna announced that it, too, had exceeded Wall Street’s expectations during the first quarter — by an astonishing 54 cents a share. Yesterday, WellPoint Inc., which operates more than a dozen Blue Cross plans across the country, announced that its earnings topped expectations by 48 cents per share.
 
When I was handling financial communications at CIGNA, I knew investors would be pleased if the company exceeded their expectations by even a penny a share. During my nearly two decades in the industry, I never saw insurers blow past what they had been expected to earn by such wide margins. Health insurers’ shareholders must be pinching themselves today to make sure they’re not dreaming.
 
To make this kind of money, insurance companies have to spend far less paying their policyholders’ medical claims than anyone thought possible.
 
They’ve been able to do that so far this year, despite the new health care reform law, by shifting many policyholders into plans that force them to spend more from their own pockets before coverage kicks in. Insurance firms also fatten their bottom lines by denying more claims.
 
What are the real-world consequences? Let me share portions of just three e-mails I received this week to give you a hint. I wish I could say that such e-mails are rare.
 
The first came from a man who actually sells policies for one of the above-mentioned firms on a part-time basis. He decided to write me after visiting a family that was on the verge of bankruptcy because of what they have to pay for insurance coverage and out-of-pocket expenses.
 
He told me that the head of the family was a small business owner who was still working well into his late 60’s because it was the only way he was able to provide insurance for himself, his wife and a daughter suffering from mental illness. He was paying $28,800 in annual premiums and had just been notified that he would have to pay 25 percent more when the current term of his policy expired.
 
Even though he was paying more than $2,000 a month for coverage, it was far from adequate. It did not cover his daughter’s three-times-a-week visits to her mental health doctors, which meant that he had to pay an additional $300 per visit out of his own pocket. On top of that, he had to pay $1,000 every month for her prescriptions.
 
“It truly disgusted me, and I had no idea what I could do to help them,” he wrote.
 
The irony is that the part-time insurance salesman who sent the email was uninsured. He couldn’t afford coverage himself.
 
The second e-mail came from Molly Poole, a woman I had met in March in Lancaster, Pa. She was writing to tell about a new website — www.LetScottLive.com — that she created to help raise money for her husband’s care. While Stephen Hemsley and a handful of other insurance company executives are becoming billionaires, Molly and Scott Poole, who has Lou Gehrig’s disease, are now effectively beggars. They wrote asking me to help spread the word about their plight and to assist in their efforts to raise money.

Here’s what Molly wrote:

In short, we have been terrorized since spring 2009 with a variety of insurance company games. First we were told (by Highmark Blue Cross) that we were about to hit Scott’s million-dollar lifetime cap ‘in the next month or so.’ That was wrong, but that didn’t stop them from calling every few months to give us another ‘you’re hitting your cap soon’ scare and giving a vague date a few months out. They were always wrong in the end, but that did nothing for the panic level at the time.

Molly wrote that Scott had been transferred to COBRA on Nov. 7, 2010, after losing his job. As that coverage was about to expire, the Pooles applied for an extension. A case manager for their insurer said it would be a waste of time to apply for the extension because Scott was rapidly approaching the lifetime coverage limit. After weeks of battle, the Pooles finally got the extension, but only for a short while.
 
“We only have coverage through May 7,” Molly, wrote, “so that’s why we’ve created a website to try to raise funds. We need to come up with approximately $400,000 a year to cover nursing and other medical costs. God forbid a hospital stay. What savings we have left are what’s running the house. We start tapping them, we lose the house.”
 
Molly ended her e-mail with this: “The illness itself has been a walk in the park compared to the insurance hassles. Can you imagine something that makes dealing with Lou Gehrig’s disease a breeze compared with what they are putting you through?”
 
The third e-mail I got was from Stan Brock, the saint who founded Remote Area Medical (RAM) to provide care to people in isolated villages in less developed countries. Stan started his mission by flying doctors to nearly inaccessible places along the Amazon River in South America.
 
Today, most of RAM’s “expeditions” are in the United States, and increasingly they are to locations that are not at all remote. I went to a RAM expedition in Wise County, Va., a few years ago. The experience changed my life and contributed to my decision to quit my job and start speaking out about the abuses of the U.S. health insurance industry.
 
Stan wrote to tell me about RAM’s most recent two expeditions in California.
 
The crowds for the pair of expeditions “were similar to those you saw in Wise County, VA. We could have seen more patients had we been allowed to bring in volunteers from out of state,” he wrote.

I am convinced that if federal laws were changed so that doctors could cross state lines to provide free care, that RAM-type operations would begin to spring up nationwide and make a significant d
ifference for health care for the underserved at no cost to the government or taxpayer. We really need an economics expert to make those sort of projections on a nationwide basis with volunteer clinics going on weekly in every state; not just by RAM but by numerous other charitable organizations and civic groups.

These three emails are just the most recent I’ve received out of many over the past several months.
 
I will continue to share some of them with you — and fill you in on how incredibly rich a few executives and shareholders are becoming while Americans are being reduced to begging for help to pay for health care or waiting for one of Stan Brock’s expeditions.
 
http://www.huffingtonpost.com/wendell-potter/health-execs-getting-rich_b_854831.html

Further comment by Uwe Reinhardt on queues in Canada

The last Quote of the Day discussed Princeton Economics Professor Uwe Reinhardt’s New York Times blog entry on rationing in Canada and the United States. I (Don McCanne) wrote a response to his article, and he responded to my comments. That response follows.

The New York Times
Economix

Uwe E. Reinhardt
Daily Economist
April 29th, 2011

Len Charlap’s Comment No. 27 requests that I respond to Comment No. 9 by Don McCanne, even though Dr. McCanne did not explicitly called for a response.

I agree with Dr. McCanne that the role of queues can easily be misunderstood.

Given a naturally or artificially limited supply of a thing, queues arise when money prices are not allowed to rise to levels that shrink the demand for the thing to match the available supply. Other prices – e.g., the price of time (e.g., waiting in a doctor’s office) or discomfort prices (the disutility of having to put up with a physical impairment while waiting) then do the equilibrating.

In the case of naturally limited supplies – e.g., supplies of transplantable organs – neither of these prices equilibrates demand and supply and some administrative mechanism of rationing occurs. My former Princeton student, later leader of the U.S. Senate and then my co-teacher of a course on health policy at Princeton, told us how that works. It is less than perfect.

In the case of artificially limited supplies, one way to reduce the time-and–discomfort prices is simply to expand the supply of the artificially limited supply.

It is true that in the past I have criticized Canadian policy makers for not doing so. They responded that they are actually quite concerned over the issue and, in fact, have sought to understand the nature of their queues better through one (or perhaps even two) Royal Commissions on queues in health care.

Since that time, they have worked on what they call “evidence-based queuing,” that is, a form of queuing that uses queuing theory and seeks to minimize the physical harm of queuing, giving serious cases faster access than is available to less serious cases.

My Canadian colleagues tell me what Canadians do not want to do is to have their supply side driven by entrepreneurial forces that can easily flood the market with excess capacity and drive up costs. They cite the huge American literature on the excess use of imaging in the US as example.

Similarly, my Canadian colleagues tell me that what Canadians do not want to do is spend 17% (soon going on 20%) of the GDP on health care, especially when there is no evidence that it begets better overall health statistics (and often worse statistics), greater patient satisfaction, and moreover leaves millions of citizens without health insurance and spotty access to care, not even to speak of financial distress.

It is not hard to sympathize with them on that view.

http://community.nytimes.com/comments/economix.blogs.nytimes.com/2011/04/29/does-the-ryan-plan-curb-health-spending/?permid=9#comment9

Uwe Reinhardt on rationing in Canada and the U.S.

Does the Ryan Plan Curb Health Spending?

By Uwe E. Reinhardt
The New York Times
April 29, 2011

My post last week, on the budget plan offered by Representative Paul D. Ryan, Republican of Wisconsin and chairman of the House Budget Committee, ended with the observation that the plan did not propose measures to control overall health spending in the United States, “nor does that appear to have been Mr. Ryan’s objective.”

The general idea is that, using whatever financial resources are available to them, patients or their loved ones will, of necessity, engage in a benefit-cost analysis and decide whether the anticipated benefits of end-of-life care exceed its expected cost to the household in terms of what that household has to forgo to buy the extra care. This is how markets work.

Economic theory suggests that, other things being equal, rich and less rich households will come to different conclusions on this question. If less money is available over all to spend on elderly Americans, it is the lower middle class that is likely to do most of the self-rationing.

Note that the Ryan plan proposes a means test to determine the federal contribution to Medicare — the very poor elderly will receive larger federal subsidies, although the size of these subsidies remain unspecified. But the middle and lower-middle class is likely to be on its own.

For reasons that escape me, many Americans do not regard rationing scarce resources through the marketplace, by price and ability to pay, as rationing at all, reserving that term for government withholding of marginally beneficial procedures, based on formal cost-effectiveness analysis.

I do beg to differ.

I have also applied the economist’s reasoning to an analysis of styles of rationing in Canada and in the United States and would be happy to hear what readers make of that. (See link below.)

http://economix.blogs.nytimes.com/2011/04/29/does-the-ryan-plan-curb-health-spending/

Uwe Reinhardt: “Keeping Health Care Afloat – The United States Versus Canada”:
http://www.princeton.edu/~reinhard/pdfs/MILKEN%20REVIEW%20CANADA%20vs%20US.pdf

Readers’ Comments

9. Don McCanne
San Juan Capistrano, CA
April 29th, 2011

Professor Reinhardt’s discussion of rationing in the United States and Canada, available at the “an analysis” link in his article above (the “Keeping Health Care Afloat” link), is an absolute must read for those who really care about how we finance health care.

In a personal communication, Dr. Reinhardt has suggested that we have not been adequately forthcoming about the problems of rationing in Canada, especially the development of queues for non-urgent services. (“We” refers to the fact that I’m senior health policy fellow for Physicians for a National Health Program, an organization supporting single payer reform not unlike Canada’s.)

It is true that we tend to discuss the virtues of single payer while not emphasizing its deficiencies, but the virtues far outweigh the deficiencies and our message would be corrupted by including a disproportionate emphasis on the problems.

That said, we certainly do concede that rationing is an issue, but also we do, in fact, address it. First, we support separate budgeting of capital improvements with an emphasis on getting capacity right to avoid both under-utilization (queues) and over-utilization (the excesses described by John Wennberg and the Dartmouth group). Admittedly, that is always a work in progress, but merely making the effort does result in improvements in capacity.

We also support the science of queue management (how the long lines at airports were reduced after they became intolerable following 9/11). Monitoring capacity and making relatively minor adjustments as needed, along with queue management, has been very effective in avoiding excess queues in many nations.

Canada has been addressing this problem with some success. In fact, if you actually read the reports from the Fraser Institute that demonstrate excessive queues, you will see that in most instances the time intervals are very close to what the specialists believe are reasonable (joint replacement being an exception).

So what actually is the overriding problem of a system like Canada’s? It lies in the ideology of the public stewards of the health care financing system. When egalitarians who believe in government are in charge, efforts are made to attend to problems such as queues and fix them. When those who oppose government programs and prefer private markets are in charge, problems such as queues are allowed to compound for the purpose of driving support for privatization of the health care system (Alberta’s former premier, Ralph Klein, being a prime example).

So, Dr. Reinhardt, I hereby publicly confess that there are potential problems with rationing in a single payer system, but not nearly as severe as the U.S. style of rationing which causes massive suffering and death simply because we ration based on ability to pay. In fact, since all systems ration, selecting rationing that improves value in our health care purchasing might be better labeled as “beneficial rationing.”

Unfortunately, a new report released by the Commonwealth Fund this week shows that, although health insurance will be more affordable because of subsidies under the Affordable Care Act, about one-fourth of middle-income Americans who actually require significant health care will still not be able to pay for it, in spite of subsidies. Rationing by ability to pay was not eliminated by the Affordable Care Act.

Dr. Reindardt, you have also suggested that single payer works better in Canada than it would in the United States simply because Canadians are more egalitarian than we are. But look at the outrage expressed over Paul Ryan’s proposal to privatize our egalitarian Medicare program. Americans can be quite egalitarian when we have something good that works well for all of us.

http://community.nytimes.com/comments/economix.blogs.nytimes.com/2011/04/29/does-the-ryan-plan-curb-health-spending/?permid=9#comment9

Further comment: 

Uwe Reinhardt’s eight page article, “Keeping Health Care Afloat – The United States Versus Canada,” should be downloaded and saved to use as an important resource when responding to expressed concerns about rationing. It is available at the link above.

The most common reason given as to why the United States should reject a Canadian-style single payer system is that it would result in intolerable rationing. Reinhardt’s highly credible article explains in factual terms how rationing works in these two countries. Using Reinhardt’s facts, it is very difficult for me to see how anyone could have an opinion other than it is the United States and not Canada that has intolerable rationing.

Vermont Debates Universal Health Care

The Diane Rehm Show, NPR, April 27, 2011

On April 27, Dr. Robert Zarr, national board member and co-chair of the D.C. chapter of Physicians for a National Health Program, appeared on NPR’s “The Diane Rehm Show” with Vermont Gov. Peter Shumlin, NPR’s Julie Rovner, and the Cato Institute’s Michael Cannon. You can listen to the 51-minute program by clicking on this link and clicking again on “Listen.”

A complete transcript of the show is available here.

Uwe Reinhardt on rationing in Canada and the U.S.

Does the Ryan Plan Curb Health Spending?

By Uwe E. Reinhardt
The New York Times
April 29, 2011

My post last week, on the budget plan offered by Representative Paul D. Ryan, Republican of Wisconsin and chairman of the House Budget Committee, ended with the observation that the plan did not propose measures to control overall health spending in the United States, “nor does that appear to have been Mr. Ryan’s objective.”

The general idea is that, using whatever financial resources are available to them, patients or their loved ones will, of necessity, engage in a benefit-cost analysis and decide whether the anticipated benefits of end-of-life care exceed its expected cost to the household in terms of what that household has to forgo to buy the extra care. This is how markets work.

Economic theory suggests that, other things being equal, rich and less rich households will come to different conclusions on this question. If less money is available over all to spend on elderly Americans, it is the lower middle class that is likely to do most of the self-rationing.

Note that the Ryan plan proposes a means test to determine the federal contribution to Medicare — the very poor elderly will receive larger federal subsidies, although the size of these subsidies remain unspecified. But the middle and lower-middle class is likely to be on its own.

For reasons that escape me, many Americans do not regard rationing scarce resources through the marketplace, by price and ability to pay, as rationing at all, reserving that term for government withholding of marginally beneficial procedures, based on formal cost-effectiveness analysis.

I do beg to differ.

I have also applied the economist’s reasoning to an analysis of styles of rationing in Canada and in the United States and would be happy to hear what readers make of that. (See link below.)

http://economix.blogs.nytimes.com/2011/04/29/does-the-ryan-plan-curb-health-spending/

Uwe Reinhardt: “Keeping Health Care Afloat – The United States Versus Canada”:
http://www.princeton.edu/~reinhard/pdfs/MILKEN%20REVIEW%20CANADA%20vs%20US.pdf

9. Don McCanne
San Juan Capistrano, CA
April 29th, 2011

Professor Reinhardt’s discussion of rationing in the United States and Canada, available at the “an analysis” link in his article above (the “Keeping Health Care Afloat” link), is an absolute must read for those who really care about how we finance health care.

In a personal communication, Dr. Reinhardt has suggested that we have not been adequately forthcoming about the problems of rationing in Canada, especially the development of queues for non-urgent services. (“We” refers to the fact that I’m senior health policy fellow for Physicians for a National Health Program, an organization supporting single payer reform not unlike Canada’s.)

It is true that we tend to discuss the virtues of single payer while not emphasizing its deficiencies, but the virtues far outweigh the deficiencies and our message would be corrupted by including a disproportionate emphasis on the problems.

That said, we certainly do concede that rationing is an issue, but also we do, in fact, address it. First, we support separate budgeting of capital improvements with an emphasis on getting capacity right to avoid both under-utilization (queues) and over-utilization (the excesses described by John Wennberg and the Dartmouth group). Admittedly, that is always a work in progress, but merely making the effort does result in improvements in capacity.

We also support the science of queue management (how the long lines at airports were reduced after they became intolerable following 9/11). Monitoring capacity and making relatively minor adjustments as needed, along with queue management, has been very effective in avoiding excess queues in many nations.

Canada has been addressing this problem with some success. In fact, if you actually read the reports from the Fraser Institute that demonstrate excessive queues, you will see that in most instances the time intervals are very close to what the specialists believe are reasonable (joint replacement being an exception).

So what actually is the overriding problem of a system like Canada’s? It lies in the ideology of the public stewards of the health care financing system. When egalitarians who believe in government are in charge, efforts are made to attend to problems such as queues and fix them. When those who oppose government programs and prefer private markets are in charge, problems such as queues are allowed to compound for the purpose of driving support for privatization of the health care system (Alberta’s former premier, Ralph Klein, being a prime example).

So, Dr. Reinhardt, I hereby publicly confess that there are potential problems with rationing in a single payer system, but not nearly as severe as the U.S. style of rationing which causes massive suffering and death simply because we ration based on ability to pay. In fact, since all systems ration, selecting rationing that improves value in our health care purchasing might be better labeled as “beneficial rationing.”

Unfortunately, a new report released by the Commonwealth Fund this week shows that, although health insurance will be more affordable because of subsidies under the Affordable Care Act, about one-fourth of middle-income Americans who actually require significant health care will still not be able to pay for it, in spite of subsidies. Rationing by ability to pay was not eliminated by the Affordable Care Act.

Dr. Reindardt, you have also suggested that single payer works better in Canada than it would in the United States simply because Canadians are more egalitarian than we are. But look at the outrage expressed over Paul Ryan’s proposal to privatize our egalitarian Medicare program. Americans can be quite egalitarian when we have something good that works well for all of us.

Comment originally published on the New York Times website

Further comment: Uwe Reinhardt’s eight page article, “Keeping Health Care Afloat – The United States Versus Canada,” should be downloaded and saved to use as an important resource when responding to expressed concerns about rationing. It is available at the link above.

The most common reason given as to why the United States should reject a Canadian-style single payer system is that it would result in intolerable rationing. Reinhardt’s highly credible article explains in factual terms how rationing works in these two countries. Using Reinhardt’s facts, it is very difficult for me to see how anyone could have an opinion other than it is the United States and not Canada that has intolerable rationing.

The quest for significance

By Sherif Emil, M.D.
Bulletin of the American College of Surgeons, April 2011

Click here for an attractive, five-page PDF version of Dr. Sherif Emil’s stirring address delivered at the University of California, Irvine, School of Medicine commencement ceremonies on June 5, 2010. He says in part: “Health care should not be a liberal or conservative issue, for disease, disability, and death do not recognize political affiliations. As a socially conservative Christian, my personal belief that health care is a fundamental human right, best guaranteed through single-payer universal health coverage, stems from my faith, and not despite it. My faith calls for personal morality, but also for societal morality — how do we treat the sick among us, the weak among us, the least among us?”