PNHP

Affordable Care Act is wrong framework to fix adverse selection

Affordable Care Act is wrong framework to fix adverse selection

States Should Structure Insurance Exchanges to Minimize Adverse Selection

By Sarah Lueck
Center on Budget and Policy Priorities
August 17, 2010
The health reform law (the Affordable Care Act) relies primarily on states to establish health insurance exchanges — marketplaces that provide affordable, good-quality coverage options to individuals and small businesses. But it gives states substantial flexibility in how they structure the exchanges.
Adverse selection — the separation of healthier and less-healthy people into different insurance arrangements — will occur if a disproportionate number of people who are in poorer health and have high health expenses enroll in coverage through the insurance exchanges, while healthier, lower-cost people disproportionately enroll in plans offered through the individual and small-business markets outside the exchanges. If that occurs, the cost of exchange coverage will be higher than the cost of plans offered in outside markets. That would drive up costs not only for consumers and small firms purchasing coverage through the exchanges, but also for the federal government, which must provide premium subsidies to enable low- and moderate-income people to afford coverage in the exchanges.
Higher premiums would depress participation in the exchanges by individuals and small businesses, particularly by those people and firms that can obtain better deals in outside markets. That, in turn, could raise premiums even higher in the exchanges and could ultimately result in their failure over time.
Risk Adjustment and Risk Pooling Will Reduce But Not Prevent Adverse Selection
The law also requires use of a risk-adjustment system, in which plans with sicker-than-average overall enrollments receive payments to compensate them for their resulting higher costs. The payments would come from plans that enroll healthier-than-average people that do not cost as much to cover.
As CBO has warned, the inability of current risk-adjustment systems to fully adjust for differences in health care costs between low- and high-cost groups means that, among plans in the same risk-adjustment system, “premiums for enrollees in plans that attract higher-cost beneficiaries [could] rise substantially over time.”
Another potentially helpful provision of the Affordable Care Act requires a “single risk pool,” meaning that each insurer operating inside and outside of an exchange will be required to treat all of its enrollees as a single group when setting premiums.
These pooling requirements, however, have significant limitations — for example, the risk-pooling requirement would apply only to insurers that choose to sell products both inside and outside an exchange. And as noted below, even in cases when insurers do sell products in both markets, it is likely to be difficult to enforce the requirement and ensure that risk is actually being pooled. In addition, the requirement that insurers offering identical plans in both markets charge the same premium in both places is weakened by the fact that the Affordable Care Act does not require insurers participating in both markets to offer the same plans inside and outside the exchange.
Some Elements of the Affordable Care Act Leave Exchanges at Risk for Adverse Selection
Under the Affordable Care Act, the existing individual and small-group markets can continue to operate outside the exchanges. Many of the law’s requirements relating to individual and small-group insurance plans will apply regardless of whether the plans are offered inside or outside the exchanges. For example, all new plans offered — whether through the exchanges or through outside markets — will have to provide a package of “essential benefits” and a minimum level of coverage (as measured by actuarial value). In addition, the law’s new “rating rules,” including those that prevent insurers from charging different prices based on a person’s health status, will apply to new individual-market and small-group plans regardless of whether the plans are offered inside or outside the exchanges.
But various other Affordable Care Act requirements apply only to health plans offered through an exchange, such as requirements related to the adequacy of provider networks, reporting on health care quality, grievance procedures, marketing practices, and benefit design. In addition, the law allows the Secretary of the U.S. Department of Health and Human Services to set additional standards for plans offered through the exchange, which plans sold outside an exchange are not required by federal law to meet.
This leaves substantial opportunity for adverse selection because insurers in these external markets will effectively be competing for enrollees against the exchange plans, but will not have to comply with standards that are as strict. Insurers operating outside the exchanges could seek to take advantage of these looser rules to attract healthier people and businesses, while leaving sicker people to enroll in coverage through the exchanges. As a result, the differences in rules would likely create an unlevel playing field and thereby increase the likelihood of adverse selection against the exchanges unless states institute protective measures.
In addition, under the Affordable Care Act, states have the option of setting up two separate exchanges — one for individuals and another for small businesses. States that do so may find that the exchanges lack the necessary volume to attract a sufficient number of insurers, ensure a large enough pool of enrollees that is well-balanced between the healthy and the sick, and achieve the economies of scale that can keep an exchange’s administrative costs low.
(This paper focuses on the risk of adverse selection between a health insurance exchange and outside health insurance markets. Another type of adverse selection could occur among plans within an exchange; this will be the subject of a future analysis.)
http://www.cbpp.org/cms/index.cfm?fa=view&id=3267

Any health care financing system that divides health care funds into separate risk pools inevitably experiences adverse selection. In fact, private insurers do all that they can to see that their own risk pools contain low-cost healthier individuals while shifting higher-cost individuals into other public or private risk pools. As this article indicates, numerous regulations can be introduced that may reduce the magnitude of these differences, but they can never be eliminated.
When Medicare was financed using a single risk pool, adverse selection did not exist. Once private insurers were allowed to offer options to the traditional Medicare program (Medicare + Choice and then Medicare Advantage), multiple risk pools were established providing an opening for private insurers to game the system – and game it they did. They skirted the rules to selectively market the healthier sector of the Medicare population. They further pushed up their overpayments by upcoding the diagnoses – creating the deception that their enrollees were sicker than they actually were so that they wouldn’t be subject to risk adjustment (adjusting payments to reflect the health status of those in the pool).
Who suffers? Individuals, employers, taxpayers, health care providers. Who benefits? The private insurers.
Adverse selection was not simply an inconvenient policy problem that the legislators had to fiddle with merely because they rejected the concept of a single universal risk pool that eliminates the problem of adverse selection. Far worse, it was a deliberate policy decision supported by the leadership of the private insurance industry who held the hands of the legislators as they led them down the primrose path to the everlasting bonfire that they call reform.
The Center on Budget and Policy Priorities (CBPP) report lists a few policy tweaks that are an attempt to patch some of the loopholes, but there are two major problems with their recommendations.
First, since the insurance exchanges are established on a state by state basis, each and every state must have its own enlightened and caring leadership that would oversee the intensive oversight efforts that will be required to reduce (but not eliminate) these injustices. That will never happen in most states.
The greater problem with the CBPP analysis and recommendations is that they completely excluded any consideration of the solution that really would work – a single universal risk pool through a single payer national health program, such as an improved Medicare for all.

Bill Moyers on John Geyman's "HIJACKED"

Bill Moyers on John Geyman's "HIJACKED"

“You think the battle for real health care reform is over? John Geyman says ‘Not on your life!’ And, by the way, your life is what’s at stake. This former Republican country doctor and long-time respected scholar, editor, and advocate for reform that puts the patient, not the industry, first, has issued an informed, convincing, and passionate account of why the battle has just begun, and how we, the people, can win.”

Bill Moyers, author of “Moyers on Democracy”

Comment:

By Don McCanne, MD

HIGHJACKED – The Road to Single Payer in the Aftermath of Stolen Health Care Reform
by John Geyman

Everyone needs to read this book. Order your copy now. (I’m ordering ten copies – to share with others.):

To order:
http://www.commoncouragepress.com/index.cfm?action=book&bookid=402

Bill Moyers on John Geyman’s “HIJACKED”

Bill Moyers on John Geyman’s “HIJACKED”

“You think the battle for real health care reform is over? John Geyman says ‘Not on your life!’ And, by the way, your life is what’s at stake. This former Republican country doctor and long-time respected scholar, editor, and advocate for reform that puts the patient, not the industry, first, has issued an informed, convincing, and passionate account of why the battle has just begun, and how we, the people, can win.”

Bill Moyers, author of “Moyers on Democracy”

Comment:

By Don McCanne, MD

HIGHJACKED – The Road to Single Payer in the Aftermath of Stolen Health Care Reform
by John Geyman

Everyone needs to read this book. Order your copy now. (I’m ordering ten copies – to share with others.):

To order:
http://www.commoncouragepress.com/index.cfm?action=book&bookid=402

Bill Moyers on John Geyman's "HIJACKED"

Bill Moyers on John Geyman’s “HIJACKED”

“You think the battle for real health care reform is over? John Geyman says ‘Not on your life!’ And, by the way, your life is what’s at stake. This former Republican country doctor and long-time respected scholar, editor, and advocate for reform that puts the patient, not the industry, first, has issued an informed, convincing, and passionate account of why the battle has just begun, and how we, the people, can win.”
Bill Moyers, author of “Moyers on Democracy”

HIGHJACKED – The Road to Single Payer in the Aftermath of Stolen Health Care Reform
by John Geyman
Everyone needs to read this book. Order your copy now. (I’m ordering ten copies – to share with others.):
To order:
http://www.commoncouragepress.com/index.cfm?action=book&bookid=402

Bill Moyers on John Geyman’s “HIJACKED”

Bill Moyers on John Geyman’s “HIJACKED”

“You think the battle for real health care reform is over? John Geyman says ‘Not on your life!’ And, by the way, your life is what’s at stake. This former Republican country doctor and long-time respected scholar, editor, and advocate for reform that puts the patient, not the industry, first, has issued an informed, convincing, and passionate account of why the battle has just begun, and how we, the people, can win.”

Bill Moyers, author of “Moyers on Democracy”

HIGHJACKED – The Road to Single Payer in the Aftermath of Stolen Health Care Reform
by John Geyman

Everyone needs to read this book. Order your copy now. (I’m ordering ten copies – to share with others.):

To order:
http://www.commoncouragepress.com/index.cfm?action=book&bookid=402

Soft-pedaling reform

Dems retreat on health care cost pitch

By Ben Smith
Politico
August 19, 2010

Key White House allies are dramatically shifting their attempts to defend health care legislation, abandoning claims that it will reduce costs and the deficit and instead stressing a promise to “improve it.”

The messaging shift was circulated this afternoon on a conference call and PowerPoint presentation organized by FamiliesUSA.

The Herndon Alliance, which presented the research, is a low-profile group that  coordinated liberal messaging in favor of the public option in health care.

http://www.politico.com/news/stories/0810/41271.html

And…

Implementing Health Reform: A Communications Perspective

By Lake Research Partners, Greenberg Quinlan Rosner Research, and The Herndon Alliance
August 19, 2010

Challenging Environment (Slide 4):

Straightforward “policy” defenses fail to be moving voters’ opinions about the law.

Public is disappointed, anxious, and depressed by current direction of country – not trusting.

Voters are concerned about rising health care costs and believe costs will continue to rise.

Women in particular are concerned that health law will mean less provider availability – scarcity an issue.

Many don’t believe health reform will help the economy.

Strategic Recommendations: The “Do Nots” (Slide 24):

Don’t assume public knows the  health reform law passed or if they know it passed understand how it will affect them

Don’t list benefits outside of any personal context

Don’t barrage voters with a long list of benefits

Don’t use complex language or insider jargon

Don’t use heated political rhetoric or congratulatory language

Don’t say the law will reduce costs and deficit

PowerPoint presentation
http://www.politico.com/static/PPM153_pp.html

And…

Herndon Alliance Statement on Politico Story

Herndon Alliance

Our research reaffirms that the more the public hears about the specific reforms in the law, the more they like it. The strategy of informing and educating the public about the law continues to be the right strategy.  The Politico story (Aug 19, 2010)  is wrong when it says groups supporting affordable health care for the American people are dramatically changing their strategy.  There is no reason to do so — our research reaffirms that the more the public hears about the specific reforms in the law, the more they like it.  And our research finds that there is a need to cut the political flak and give real information to the public.  Americans are tired of the partisan spin that many opponents continue to throw at the health reform law. Hard-working people are thinking about the economy and just want to know how the law will help them and their families. That is what the President and the administration have been doing — it is the approach we support.

http://herndonalliance.org/

Comment: 

By Don McCanne, MD

The conclusions and recommendations presented during the Families USA conference call were based on polls and focus groups conducted by Herndon’s research partners. In spite of Herndon’s positive spin, the research confirms that the Obama administration and the Democrats in Congress face a very “challenging environment” as they attempt to sell the benefits of the Patient Protection and Affordable Care Act.

Their recommendations for communicating the benefits of reform might best be characterized as “keep it simple, stupid,” relying heavily on personal anecdotes. Don’t confuse the public with the actual policies that are now law, and certainly don’t claim that the law will reduce costs or the deficit.

Many will remember that these are the same partners that pushed the message of choosing your own health plan, while actively suppressing any references to single payer or Medicare for all. They seemed to have the view that the message was of prime importance and policy be damned. Obviously they haven’t changed.

This next time, let’s first define optimal policy (single payer) and then develop a message that fits. As Herndon states, we “need to cut the political flak and give real information to the public.”

Medicare for All is the most Cost-Effective Health Care Option for America

Washington D.C. (July 29, 2010) – Representative John Conyers, Jr. (D-MI), Representative Dennis Kucinich (D-OH), and Senator Bernie Sanders (I-VT) are today reaffirming their efforts to provide all Americans with health care that would allow access to the doctor of choice without premiums, co-pays or deductibles.
 
The three Congressional leaders on Medicare for All health care sent an open letter calling on Americans to build on the momentum created by debate and passage of the Patient Protection and Affordable Care Act to make Medicare for All a reality.  They also renewed the call for states to take the lead on passing Medicare for All legislation.   
 
“As we honor Medicare’s 45th birthday today, I am proud to say that the movement for Medicare for All remains strong and vibrant.  I look forward to working with my colleagues, activists, and my other friends in the single payer community to improve H.R. 676 over the next few months, before reintroducing it in the 112th Congress.        
 
While we must continue to work for the passage of a true universal health care bill, we must also be vigilant in our efforts to protect the health care benefits many Americans count on today.  Over 47 million older adults and people with disabilities look to Medicare as a source of health and financial security.  During this period of increased concern over the size of the federal deficit, Medicare and other social insurance programs are increasingly at risk of being targeted for benefit cuts. I pledge to work with my colleagues in the Congress to defeat any proposal that threatens any of these critically important programs,” said Conyers.
 
“I celebrate Medicare’s birthday by pledging to continue the fight to implement Medicare for All nationally and at the state level, where there is so much promise” said Kucinich.
 
“In my view, the single-payer approach is the only way we will ever have a cost-effective, comprehensive health care system in this country,” said Sanders. “One of the reasons our current health care system is so expensive, so wasteful, so bureaucratic, so inefficient is that it is heavily dominated by private health insurance companies whose only goal in life is to make as much money as they can.”

Getting Personal: Without Medicare I'd Be Broke or Dead

By Saul Friedman
The Huffington Post, Aug. 17, 2010

It’s not too late to observe and celebrate the 45th anniversary of Medicare, for it’s a good occasion to wonder, in this time of economic distress, what life would have been like without it for the 45 million of us who are eligible because we are disabled or over 65.

One reason I ask is I suspect those deficit crazies have not thought about the consequences for Medicare if, as Republicans suggest, the Social Security retirement age is raised from 66 to 70 on the grounds that we’re all living longer. It does not occur to these loonies that Social Security and Medicare are among the reasons for the increase in longevity. But then members of Congress will always have all the coverage they need for themselves and their families, subsidized by your taxes and mine.

Nevertheless, by putting aside the human issues for a phony bottom line and a deficit that matters little to most of us, it would not be long before these lawmakers on Barack Obama’s deficit commission would raise the Medicare age eligibility. That, of course would sharply increase by at least a few million, the nearly 50 million Americans under 65, including 10 million children and babies, who are without adequate health coverage and are dependent on emergency rooms or free clinics.

If I may get personal, let me tell you what Medicare has meant for me, for my experience has not been unusual, although I’m lucky to have supplementary coverage through my wife’s former employer, which used to be free but now costs a bundle. Most other Medicare beneficiaries have similar secondary coverage through former employers or one of several Medigap policies sold by several insurers to cover some or all of the costs not covered by Medicare. I don’t mean to get too basic, but Medicare Part A, which pays for hospitalization, has rather high deductibles; Medicare Part B covers 80 percent of the cost of physician and lab services. Secondary insurance covers those Medicare gaps, and some may provide drug coverage.

Anyway, in 2003 I had a serious stroke, which partly paralyzed my right side and necessitated hundreds of hours of inpatient and outpatient rehabilitation at several of the nation’s finest facilities. The stroke was caused by a heart malfunction, which was cured with minor surgery. In 2005, after too many years as a smoker (I had quit in 1976), I was diagnosed with cancer of the esophagus, which is usually fatal. But chemotherapy, radiation and radical surgery at Johns Hopkins in Baltimore saved my life.

For all this, plus frequent checkups, Ct-Scans, routine doctor visits and a recent prostate procedure, I have paid nothing aside from the reasonable Medicare Part B premiums and the cost of secondary coverage. In short, I can say what millions of Medicare beneficiaries say — without Medicare, I’d be broke, bankrupt or dead. But that, alas, has been the experience of the millions, who because they are too young, have been denied Medicare. Nor do they yet have decent, dependable and affordable health care because a compromising president and a spineless Congress, mostly Republicans and conservative Democrats, have declined to give the rest of the nation what they and the rest of the world have, universal health coverage like Medicare.

The anniversary of Medicare’s adoption, by a liberal Democratic Congress and President (Lyndon B. Johnson), has give advocates an opportunity to list its lesser known accomplishments. While most of the new health reforms won’t become effective until 2014 (the Part D doughnut hole won’t close until six years later), Medicare was serving 19 million Americans a year after passage. In a paper written by June Eichner and Medicare’s first director, Bruce Vladek, they point out that beginning in 1966, as the nation’s largest purchaser of health care Medicare desegregated most hospitals as a condition for receiving Medicare reimbursement. Since then, they wrote, Medicare has contributed not only to the improvements to the lives and health of the disabled and older populations, but has gone far in erasing disparities between blacks and whites. More than 25 percent of Medicare beneficiaries were living in poverty in 1965.

The passage of Medicare came just after the Civil Rights Act of 1964. Which is why southern Democrats joined Republicans in resisting Medicare. But because of those two landmark pieces of legislation, the National Bureau of Economic Research found that “the gains in black access to hospitals (in Mississippi) coincide with a striking reduction in black post-neonatal deaths for causes considered preventable.” The cost for these improvement were borne by Medicaid, also passed, along with Medicare, to provide care for the very poor.

Another study noted that Medicare played a significant role in the education of today’s physicians. According to an April Wall Street Journal, there are about 110,000 resident positions in teaching hospitals that rely heavily on Medicare funding. Medicare pays $9.1 billion a year to teaching hospitals, which pays residents’ salaries as well as the higher operating costs associated with teaching hospitals, which tend to see the sickest, most costly and uninsured patients. Unfortunately conservative diehards kept out of the health reforms any increase in the number of funded residencies.

There are, too, a few glitches that have shown up lately in Medicare that need fixing. Under current law, persons over 65 who end their employment and employer health coverage must apply for Medicare during a “special enrollment period,” up to eight month after that coverage ceases. But if the workers chooses to get COBRA coverage, which usually lasts 18 months, they may not realize that they will be disqualified from the special enrollment period and will have to wait until the regular open enrollment period, from January through March 31. In that case, their Medicare coverage won’t begin until July 1. This rule is 24 years old, but because it’s happening frequently, legislation is pending to permit signing up for Medicare when COBRA runs out.

Here’s another glitch, discovered by Bloomberg News. Under current law, a person (who suffered a stroke or was injured) is entitled to skilled nursing care and rehabilitation, after three days in a hospital. But lately some hospitals, to save money, are keeping patients “under observation” and not admitting them, thus depriving them of the rehabilitation they need. Medicare auditors are challenging this practice, which should be reported as fraud to Medicare.

Finally the biggest necessary fix is the one Obama said he was for, before he became president; Medicare For All. It is the subject of a new appeal to the Congress by Reps. Dennis Kucinich (D, Ohio), John Conyers (D, Mich.), and Independent Sen. Bernie Sanders of Vermont. If Congress won’t pass it, they asked that states be permitted to adopt it. It would be better, of course, if Medicare for All was federal law. If Obama led the way, he could be in the same leagues as LBJ. But our president for change, who has yet to speak forcefully against cutting or tampering with Social Security benefits, is too busy to listen. Maybe it’s possible in a second term, if he gets one.

Write to saulfriedman@comcast.net Friedman also writes for www.timegoesby.net

http://www.huffingtonpost.com/saul-friedman/getting-personal-without_b_685665.html

Getting Personal: Without Medicare I’d Be Broke or Dead

By Saul Friedman
The Huffington Post, Aug. 17, 2010

It’s not too late to observe and celebrate the 45th anniversary of Medicare, for it’s a good occasion to wonder, in this time of economic distress, what life would have been like without it for the 45 million of us who are eligible because we are disabled or over 65.

One reason I ask is I suspect those deficit crazies have not thought about the consequences for Medicare if, as Republicans suggest, the Social Security retirement age is raised from 66 to 70 on the grounds that we’re all living longer. It does not occur to these loonies that Social Security and Medicare are among the reasons for the increase in longevity. But then members of Congress will always have all the coverage they need for themselves and their families, subsidized by your taxes and mine.

Nevertheless, by putting aside the human issues for a phony bottom line and a deficit that matters little to most of us, it would not be long before these lawmakers on Barack Obama’s deficit commission would raise the Medicare age eligibility. That, of course would sharply increase by at least a few million, the nearly 50 million Americans under 65, including 10 million children and babies, who are without adequate health coverage and are dependent on emergency rooms or free clinics.

If I may get personal, let me tell you what Medicare has meant for me, for my experience has not been unusual, although I’m lucky to have supplementary coverage through my wife’s former employer, which used to be free but now costs a bundle. Most other Medicare beneficiaries have similar secondary coverage through former employers or one of several Medigap policies sold by several insurers to cover some or all of the costs not covered by Medicare. I don’t mean to get too basic, but Medicare Part A, which pays for hospitalization, has rather high deductibles; Medicare Part B covers 80 percent of the cost of physician and lab services. Secondary insurance covers those Medicare gaps, and some may provide drug coverage.

Anyway, in 2003 I had a serious stroke, which partly paralyzed my right side and necessitated hundreds of hours of inpatient and outpatient rehabilitation at several of the nation’s finest facilities. The stroke was caused by a heart malfunction, which was cured with minor surgery. In 2005, after too many years as a smoker (I had quit in 1976), I was diagnosed with cancer of the esophagus, which is usually fatal. But chemotherapy, radiation and radical surgery at Johns Hopkins in Baltimore saved my life.

For all this, plus frequent checkups, Ct-Scans, routine doctor visits and a recent prostate procedure, I have paid nothing aside from the reasonable Medicare Part B premiums and the cost of secondary coverage. In short, I can say what millions of Medicare beneficiaries say — without Medicare, I’d be broke, bankrupt or dead. But that, alas, has been the experience of the millions, who because they are too young, have been denied Medicare. Nor do they yet have decent, dependable and affordable health care because a compromising president and a spineless Congress, mostly Republicans and conservative Democrats, have declined to give the rest of the nation what they and the rest of the world have, universal health coverage like Medicare.

The anniversary of Medicare’s adoption, by a liberal Democratic Congress and President (Lyndon B. Johnson), has give advocates an opportunity to list its lesser known accomplishments. While most of the new health reforms won’t become effective until 2014 (the Part D doughnut hole won’t close until six years later), Medicare was serving 19 million Americans a year after passage. In a paper written by June Eichner and Medicare’s first director, Bruce Vladek, they point out that beginning in 1966, as the nation’s largest purchaser of health care Medicare desegregated most hospitals as a condition for receiving Medicare reimbursement. Since then, they wrote, Medicare has contributed not only to the improvements to the lives and health of the disabled and older populations, but has gone far in erasing disparities between blacks and whites. More than 25 percent of Medicare beneficiaries were living in poverty in 1965.

The passage of Medicare came just after the Civil Rights Act of 1964. Which is why southern Democrats joined Republicans in resisting Medicare. But because of those two landmark pieces of legislation, the National Bureau of Economic Research found that “the gains in black access to hospitals (in Mississippi) coincide with a striking reduction in black post-neonatal deaths for causes considered preventable.” The cost for these improvement were borne by Medicaid, also passed, along with Medicare, to provide care for the very poor.

Another study noted that Medicare played a significant role in the education of today’s physicians. According to an April Wall Street Journal, there are about 110,000 resident positions in teaching hospitals that rely heavily on Medicare funding. Medicare pays $9.1 billion a year to teaching hospitals, which pays residents’ salaries as well as the higher operating costs associated with teaching hospitals, which tend to see the sickest, most costly and uninsured patients. Unfortunately conservative diehards kept out of the health reforms any increase in the number of funded residencies.

There are, too, a few glitches that have shown up lately in Medicare that need fixing. Under current law, persons over 65 who end their employment and employer health coverage must apply for Medicare during a “special enrollment period,” up to eight month after that coverage ceases. But if the workers chooses to get COBRA coverage, which usually lasts 18 months, they may not realize that they will be disqualified from the special enrollment period and will have to wait until the regular open enrollment period, from January through March 31. In that case, their Medicare coverage won’t begin until July 1. This rule is 24 years old, but because it’s happening frequently, legislation is pending to permit signing up for Medicare when COBRA runs out.

Here’s another glitch, discovered by Bloomberg News. Under current law, a person (who suffered a stroke or was injured) is entitled to skilled nursing care and rehabilitation, after three days in a hospital. But lately some hospitals, to save money, are keeping patients “under observation” and not admitting them, thus depriving them of the rehabilitation they need. Medicare auditors are challenging this practice, which should be reported as fraud to Medicare.

Finally the biggest necessary fix is the one Obama said he was for, before he became president; Medicare For All. It is the subject of a new appeal to the Congress by Reps. Dennis Kucinich (D, Ohio), John Conyers (D, Mich.), and Independent Sen. Bernie Sanders of Vermont. If Congress won’t pass it, they asked that states be permitted to adopt it. It would be better, of course, if Medicare for All was federal law. If Obama led the way, he could be in the same leagues as LBJ. But our president for change, who has yet to speak forcefully against cutting or tampering with Social Security benefits, is too busy to listen. Maybe it’s possible in a second term, if he gets one.

Write to saulfriedman@comcast.net Friedman also writes for www.timegoesby.net

http://www.huffingtonpost.com/saul-friedman/getting-personal-without_b_685665.html

Soft-pedaling reform

Dems retreat on health care cost pitch

By Ben Smith
Politico
August 19, 2010
Key White House allies are dramatically shifting their attempts to defend health care legislation, abandoning claims that it will reduce costs and the deficit and instead stressing a promise to “improve it.”
The messaging shift was circulated this afternoon on a conference call and PowerPoint presentation organized by FamiliesUSA.
The Herndon Alliance, which presented the research, is a low-profile group that  coordinated liberal messaging in favor of the public option in health care.
http://www.politico.com/news/stories/0810/41271.html

And…

Implementing Health Reform: A Communications Perspective

By Lake Research Partners, Greenberg Quinlan Rosner Research, and The Herndon Alliance
August 19, 2010
Challenging Environment (Slide 4):
Straightforward “policy” defenses fail to be moving voters’ opinions about the law.
Public is disappointed, anxious, and depressed by current direction of country – not trusting.
Voters are concerned about rising health care costs and believe costs will continue to rise.
Women in particular are concerned that health law will mean less provider availability – scarcity an issue.
Many don’t believe health reform will help the economy.
Strategic Recommendations: The “Do Nots” (Slide 24):
Don’t assume public knows the  health reform law passed or if they know it passed understand how it will affect them
Don’t list benefits outside of any personal context
Don’t barrage voters with a long list of benefits
Don’t use complex language or insider jargon
Don’t use heated political rhetoric or congratulatory language
Don’t say the law will reduce costs and deficit
PowerPoint presentation
http://www.politico.com/static/PPM153_pp.html

And…

Herndon Alliance Statement on Politico Story

Herndon Alliance
Our research reaffirms that the more the public hears about the specific reforms in the law, the more they like it. The strategy of informing and educating the public about the law continues to be the right strategy.  The Politico story (Aug 19, 2010)  is wrong when it says groups supporting affordable health care for the American people are dramatically changing their strategy.  There is no reason to do so — our research reaffirms that the more the public hears about the specific reforms in the law, the more they like it.  And our research finds that there is a need to cut the political flak and give real information to the public.  Americans are tired of the partisan spin that many opponents continue to throw at the health reform law. Hard-working people are thinking about the economy and just want to know how the law will help them and their families. That is what the President and the administration have been doing — it is the approach we support.
http://herndonalliance.org/

The conclusions and recommendations presented during the Families USA conference call were based on polls and focus groups conducted by Herndon’s research partners. In spite of Herndon’s positive spin, the research confirms that the Obama administration and the Democrats in Congress face a very “challenging environment” as they attempt to sell the benefits of the Patient Protection and Affordable Care Act.
Their recommendations for communicating the benefits of reform might best be characterized as “keep it simple, stupid,” relying heavily on personal anecdotes. Don’t confuse the public with the actual policies that are now law, and certainly don’t claim that the law will reduce costs or the deficit.
Many will remember that these are the same partners that pushed the message of choosing your own health plan, while actively suppressing any references to single payer or Medicare for all. They seemed to have the view that the message was of prime importance and policy be damned. Obviously they haven’t changed.
This next time, let’s first define optimal policy (single payer) and then develop a message that fits. As Herndon states, we “need to cut the political flak and give real information to the public.”

Insurance trade group sues to protect rescissions

Trade group sues over new Calif. insurance rules

By Shaya Tayefe Mohajer
San Francisco Chronicle
August 19, 2010

A new regulation that makes it harder for health insurance companies to drop individual policyholders in California is being challenged in court by an industry trade group.

The California Department of Insurance’s new regulations, which took effect Wednesday, require insurers to investigate the medical histories of those seeking individual policies before accepting any premiums.

The Association of California Life and Health Insurance Companies sued to stop the rules on Monday, accusing the state of acting “in excess of its jurisdiction and authority” by creating regulation that conflicts with the state’s insurance code.

Insurance Commissioner Steve Poizner on Thursday called the lawsuit “shortsighted and morally wrong.”

“Sometimes I think representatives in this industry have their heads permanently stuck in the sand. Illegal rescissions are a repugnant industry practice,” said Poizner.

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2010/08/19/financial/f132925D03.DTL

Comment: 

By Don McCanne, MD

One of the most egregious offenses of the health insurance industry has been to retroactively revoke an insurance policy after the insured individual files a medical claim, a process known as rescission. Public outrage over this injustice helped to drive the process that brought us the Patient Protection and Affordable Care Act (PPACA).

Apparently the insurance industry has learned nothing. Their trade organization in California has the gall to infuriate all of us by suing to protect their right to do their underwriting after a claim is filed rather than before the policy is issued, whacking the patients when they are down.

Since PPACA will make rescissions more difficult, you would think that the industry would be quiet and accept the inevitable. No. Instead they reveal that they are not simply an amoral industry but rather a truly immoral one by insisting on their right to retroactively deny payment of medical bills run up by the hapless patient, merely to save the costs of timely underwriting.

This is not the industry that should be managing our health care financing. We need our own public financing entity – a single payer national health program.