PNHP

UCSF student Eric LaMotte on single payer

UCSF student Eric LaMotte on single payer

Opinion: Healthcare Reform Not Found: Abort, Retry, Ignore?

By Eric LaMotte
Synapse, The UCSF Student Newspaper
April 8, 2010

Despite the intense efforts of a vocal minority, healthcare reform was enacted this year by congressional Democrats who claimed to place the needs of American citizens over those of corporations. Unfortunately, they chose to enact policies that will continue to allow a costly, complex, fragmented, for-profit insurance system to inflict damage on the rest of our healthcare system. Now, living in a post-reform world, we must decide where to go from here, and I am reminded of the error prompt that every frustrated computer user has had to answer at one point or another: Abort, Retry, Ignore?

Amidst the already loud voices in support of “Abort” and “Ignore,” we need to raise a new and thundering voice for “Retry.” The national single payer bill described above (in the full article at the link below) is already written: HR 676.

In California, we will have our own shot at enacting a statewide single payer system with SB 810. The bill passed the State Senate in January by a vote of 22-14. But it’s a long way from being enacted, and California’s idiosyncratic political system makes it unlikely that California will be the first state to enact a single payer plan. You can support real reform by joining efforts with PNHP/CaPA, CaHPSA, AMSA, CNA, or California OneCare.

http://synapse.ucsf.edu/articles/2010/April/8/opinion.html

For a picture of Eric LaMotte with Senator Arlen Specter, with the caption, “Senator Specter talks with first-year medical student Eric LaMotte, who supports single payer health insurance”:

http://today.ucsf.edu/stories/senator-specter-urges-ucsf-community-to-exert-political-power/

Comment: 

By Don McCanne, MD

For a breather, today’s message is an affirmation that there is hope for the future in health care, as represented by this article by Eric LaMotte, an astute medical student at the University of California at San Francisco (my alma mater).

Thanks, Eric.

(During our travels this month, qotd messages will be sporadic to nil.)

UCSF student Eric LaMotte on single payer

Opinion: Healthcare Reform Not Found: Abort, Retry, Ignore?

By Eric LaMotte
Synapse, The UCSF Student Newspaper
April 8, 2010
Despite the intense efforts of a vocal minority, healthcare reform was enacted this year by congressional Democrats who claimed to place the needs of American citizens over those of corporations. Unfortunately, they chose to enact policies that will continue to allow a costly, complex, fragmented, for-profit insurance system to inflict damage on the rest of our healthcare system. Now, living in a post-reform world, we must decide where to go from here, and I am reminded of the error prompt that every frustrated computer user has had to answer at one point or another: Abort, Retry, Ignore?
Amidst the already loud voices in support of “Abort” and “Ignore,” we need to raise a new and thundering voice for “Retry.” The national single payer bill described above (in the full article at the link below) is already written: HR 676.
In California, we will have our own shot at enacting a statewide single payer system with SB 810. The bill passed the State Senate in January by a vote of 22-14. But it’s a long way from being enacted, and California’s idiosyncratic political system makes it unlikely that California will be the first state to enact a single payer plan. You can support real reform by joining efforts with PNHP/CaPA, CaHPSA, AMSA, CNA, or California OneCare.
http://synapse.ucsf.edu/articles/2010/April/8/opinion.html
For a picture of Eric LaMotte with Senator Arlen Specter, with the caption, “Senator Specter talks with first-year medical student Eric LaMotte, who supports single payer health insurance”:
http://today.ucsf.edu/stories/senator-specter-urges-ucsf-community-to-exert-political-power/

For a breather, today’s message is an affirmation that there is hope for the future in health care, as represented by this article by Eric LaMotte, an astute medical student at the University of California at San Francisco (my alma mater).
Thanks, Eric.
(During our travels this month, qotd messages will be sporadic to nil.)

Pennsylvania's Blues avoid battle

Highmark sues to block state review of Blues competition

By Emily Berry
American Medical News
April 5, 2010

Highmark Inc. has asked a state court to block the Pennsylvania Dept. of Insurance from investigating or releasing any findings about the state of competition between the state’s four BlueCross BlueShield-affiliated plans.

In a lawsuit filed March 16, the Pittsburgh-based company accused Pennsylvania Insurance Commissioner Joel Ario of planning to try to break up the Blues plans’ current licensing arrangement, set by the BlueCross BlueShield Assn.

The state’s four Blues plans split their business into distinct territories. The only overlap is in central Pennsylvania, where Highmark, which has a Blue Shield trademark, and Capital BlueCross compete.

Pennsylvania Gov. Ed Rendell criticized Highmark’s decision to block the state’s review. “I am disappointed — but not surprised — that Highmark has chosen to fight our efforts to ensure the protection of consumers and guarantee a free and fair marketplace,” he said in a statement. “Health insurance is a big business. Historically, it has operated — and especially here in Pennsylvania — with limited regulation and weak oversight.”

http://www.ama-assn.org/amednews/2010/04/05/bisb0405.htm

Comment:

By Don McCanne, MD

Pennsylvania’s four BlueCross BlueShield plans have staked out different territories, effectively eliminating market competition between the Blues. One of the reasons that the reform model was based on private health plans was that market competition was supposed to bring us higher quality insurance products at lower costs. Instead, Pennsylvania is getting higher costs at whatever quality.

What is in the recently-enacted health reform legislation that will prevent such anti-competitive practices? The state health exchanges? This is an industry that is suing to block the release of any information about anti-competitive behavior. Just because they’ve been granted a new marketing tool in the form of the exchanges doesn’t mean that they are going to change their ways. The major markets are already concentrated amongst a few insurers, and they will continue to remain so.

Since we have lost the benefit of competition, why should we spend so much more merely to keep the private insurers in control? Let’s recover the resources that they waste and use the funds for a truly universal program that actually does cover all of us. That will require new, preemptive legislation, but it’s just what we need – an improved Medicare for everyone.

Pennsylvania’s Blues avoid battle

Highmark sues to block state review of Blues competition

By Emily Berry
American Medical News
April 5, 2010

Highmark Inc. has asked a state court to block the Pennsylvania Dept. of Insurance from investigating or releasing any findings about the state of competition between the state’s four BlueCross BlueShield-affiliated plans.

In a lawsuit filed March 16, the Pittsburgh-based company accused Pennsylvania Insurance Commissioner Joel Ario of planning to try to break up the Blues plans’ current licensing arrangement, set by the BlueCross BlueShield Assn.

The state’s four Blues plans split their business into distinct territories. The only overlap is in central Pennsylvania, where Highmark, which has a Blue Shield trademark, and Capital BlueCross compete.

Pennsylvania Gov. Ed Rendell criticized Highmark’s decision to block the state’s review. “I am disappointed — but not surprised — that Highmark has chosen to fight our efforts to ensure the protection of consumers and guarantee a free and fair marketplace,” he said in a statement. “Health insurance is a big business. Historically, it has operated — and especially here in Pennsylvania — with limited regulation and weak oversight.”

http://www.ama-assn.org/amednews/2010/04/05/bisb0405.htm

Comment:

By Don McCanne, MD

Pennsylvania’s four BlueCross BlueShield plans have staked out different territories, effectively eliminating market competition between the Blues. One of the reasons that the reform model was based on private health plans was that market competition was supposed to bring us higher quality insurance products at lower costs. Instead, Pennsylvania is getting higher costs at whatever quality.

What is in the recently-enacted health reform legislation that will prevent such anti-competitive practices? The state health exchanges? This is an industry that is suing to block the release of any information about anti-competitive behavior. Just because they’ve been granted a new marketing tool in the form of the exchanges doesn’t mean that they are going to change their ways. The major markets are already concentrated amongst a few insurers, and they will continue to remain so.

Since we have lost the benefit of competition, why should we spend so much more merely to keep the private insurers in control? Let’s recover the resources that they waste and use the funds for a truly universal program that actually does cover all of us. That will require new, preemptive legislation, but it’s just what we need – an improved Medicare for everyone.

The New Zealand Way: Another Approach to Health Care

After 28 years as a primary care physician in the U.S., Dr. Ken Fabert traveled to New Zealand to see what patients and doctors think of their single-payer system

By Dr. Ken Fabert
Yes! Magazine, April 8, 2010

As I discussed earlier, a well-organized and well-trained primary care base is vital to the rational utilization of health care resources, and a key part of the New Zealand system. Surprisingly, though, at the initial point of access, which is often a physician-owned practice, the patient is expected to pay some or even most of the cost of the encounter. Many patients, however, are able to obtain a community health services card; with it, co-pays are on a sliding scale based on income. Further subsidies are available for patients with chronic illness who have more than 12 visits per year. Despite these subsidies, I was rather surprised to learn that computerized patient account systems prompt for information about bad debts and previous payment status; this seems to be generally accepted as a necessary evil if the system is to maintain financial viability and overall fairness.

This is, however, the only part of the system that requires out-of-pocket payment. And despite the potential barrier to access posed by these co-pays, my experience in the sites I’ve visited so far is that it doesn’t seem to be a significant barrier to access. I do want to continue to observe the potential effects of this system. But that’s where the potential financial barriers end.

After being seen by a primary care doctor, all laboratory investigations, radiology tests, emergency hospital evaluations, hospitalizations, and surgery are paid for. No deductibles, no co-pays, no maximums.

Recently, primary care subsidies have been changed to include free care for children under six and full prenatal and obstetrical care. These costs are administered through primary health organizations, or PHOs, one of the primary conduits through which the annual national health budget directly pays general practitioners and other primary providers.

The Accident Compensation Corporation (ACC) is one of several pillars on which the New Zealand health care system is based. It is a no-fault national insurance program funded directly by the government to cover medical expenses stemming from any accident that occurs in New Zealand. The rules of the ACC preclude further litigation because both medical expenses and subsequent compensation are provided for. Thus, the absurdities and excesses of a litigation-driven system of compensation—such as that found in United States, where many doctors feel they must practice “defensive medicine,” ordering unnecessary tests and procedures to make sure their bases are covered in the event of a malpractice lawsuit—are simply rendered irrelevant. Health policy academics—frequently law school professors and economists rather than medical clinicians—often downplay the impact of litigation on the U.S. health care system’s high costs, but the corrosive effect of this lawyer-driven adversarial system is pervasive. Just ask any clinician. In a future blog I will address this issue more comprehensively, but for now let’s continue to look at what makes the New Zealand health care system tick.

Another recipient of government funding is the District Health Board, or DHB, which pays for hospital and laboratory services. (This is a simple mandate on paper, but as with hospital systems everywhere, efficient, fair allocation of these funds is an enormous and politically charged task. In fact, New Zealand’s health minister recently announced significant budget cuts to the DHBs, stating that more funds are to be devoted to clinical care.)

A third entity that makes up the foundation of the health system is PHARMAC, the Pharmacy Management Corporation. PHARMAC is the national pharmaceutical supplier. It negotiates directly with pharmaceutical manufacturers for supply and pricing of essential medicines. All covered drugs are $3.00 NZ ($2.10 USD) per prescription.This includes at least one, if not more, representative drug from virtually every therapeutic class of medications utilized in modern medical practice. In my three weeks of prescribing in New Zealand, I have yet to feel constrained by PHARMAC’s options. Labeled on-patent drugs are still available, but at substantially more cost to the patient—just as in the U.S., where patients do not benefit from the advantage of collective bargaining.

Finally, there is a private sector. Occasionally, patients feel that wait times are excessive for elective surgery such as joint replacements. They can then opt to be treated through the private sector, in which wait times frequently are shorter for such elective procedures. The general perception is that timing, not quality, is the difference between private and public sectors. The specter of a two-tiered health system, with better care available for the rich than the poor, doesn’t seem to have arisen. There is, not surprisingly, a growing health insurance industry for those who prefer to seek their care in the private sector. In general, the insurance industry is better regulated here than in the U.S., but I have heard stories of limitations, asterisks, exclusions, and fine print similar to those employed by the U.S. health insurance industry. But in New Zealand, of course, insurance for private care is entirely optional.

So to summarize, a medical patient in New Zealand can expect the following:

* Co-payment or full payment is needed to access a general practitioner, though subsidies are available.
* All required lab tests, investigations, emergency treatments, hospitalizations, and surgeries are free.
* Prenatal care, childbirth, and care for children under six are free.
* If the patient is injured in an accident, care is free (and subsequent compensation is provided for).
* If medications are required, covered prescriptions cost $3.00 ($2.10 US).

Is everyone in New Zealand happy with this scheme? Obviously not. But by and large, people seem to be satisfied with the provisions available to them. There is occasional grumbling, but when I ask New Zealanders if they would rather have a system like that in the United States, the response is a unanimous and unequivocal “No!”

The New Zealand health system is not socialism. It is an example of an intelligent, educated population and government understanding that one of the cornerstones of a human rights-based society (as well as a healthy, productive, and creative society) is the social provision of health care.

I see words like “landmark” and “historic” used to describe the recent health care legislation signed by President Obama. But compared to the New Zealand system, these legislative reforms are functionally inadequate and morally lacking.

I hope to gain deeper insight into this system as I continue to work here for the next two months. As I do, I’ll share them with you. This includes problems and shortcomings, but also the kind of problem-solving that is taking place to keep the citizens of this country healthy and productive.

Dr. Ken Fabert wrote this article for YES! Magazine, a national, nonprofit media organization that fuses powerful ideas with practical actions. Ken has been a practicing primary care physician in the United States for 28 years, from rural New England and South Carolina to urban Chicago and metro Seattle. A member of Physicians for a National Health Program, he is spending three months as a roving clinician in New Zealand to find out more about how their single-payer health care system works. For more of Ken Fabert’s blogs from New Zealand, click here.

http://www.yesmagazine.org/blogs/ken-fabert/the-new-zealand-way-another-approach-to-health-care?icl=email_wkly20100409&ica=tnFabert

Pennsylvania's Blues avoid battle

Highmark sues to block state review of Blues competition

By Emily Berry
American Medical News
April 5, 2010
Highmark Inc. has asked a state court to block the Pennsylvania Dept. of Insurance from investigating or releasing any findings about the state of competition between the state’s four BlueCross BlueShield-affiliated plans.
In a lawsuit filed March 16, the Pittsburgh-based company accused Pennsylvania Insurance Commissioner Joel Ario of planning to try to break up the Blues plans’ current licensing arrangement, set by the BlueCross BlueShield Assn.
The state’s four Blues plans split their business into distinct territories. The only overlap is in central Pennsylvania, where Highmark, which has a Blue Shield trademark, and Capital BlueCross compete.
Pennsylvania Gov. Ed Rendell criticized Highmark’s decision to block the state’s review. “I am disappointed — but not surprised — that Highmark has chosen to fight our efforts to ensure the protection of consumers and guarantee a free and fair marketplace,” he said in a statement. “Health insurance is a big business. Historically, it has operated — and especially here in Pennsylvania — with limited regulation and weak oversight.”
http://www.ama-assn.org/amednews/2010/04/05/bisb0405.htm
Pennsylvania’s four BlueCross BlueShield plans have staked out different territories, effectively eliminating market competition between the Blues. One of the reasons that the reform model was based on private health plans was that market competition was supposed to bring us higher quality insurance products at lower costs. Instead, Pennsylvania is getting higher costs at whatever quality.
What is in the recently-enacted health reform legislation that will prevent such anti-competitive practices? The state health exchanges? This is an industry that is suing to block the release of any information about anti-competitive behavior. Just because they’ve been granted a new marketing tool in the form of the exchanges doesn’t mean that they are going to change their ways. The major markets are already concentrated amongst a few insurers, and they will continue to remain so.
Since we have lost the benefit of competition, why should we spend so much more merely to keep the private insurers in control? Let’s recover the resources that they waste and use the funds for a truly universal program that actually does cover all of us. That will require new, preemptive legislation, but it’s just what we need – an improved Medicare for everyone.

Pennsylvania’s Blues avoid battle

Highmark sues to block state review of Blues competition

By Emily Berry
American Medical News
April 5, 2010

Highmark Inc. has asked a state court to block the Pennsylvania Dept. of Insurance from investigating or releasing any findings about the state of competition between the state’s four BlueCross BlueShield-affiliated plans.

In a lawsuit filed March 16, the Pittsburgh-based company accused Pennsylvania Insurance Commissioner Joel Ario of planning to try to break up the Blues plans’ current licensing arrangement, set by the BlueCross BlueShield Assn.

The state’s four Blues plans split their business into distinct territories. The only overlap is in central Pennsylvania, where Highmark, which has a Blue Shield trademark, and Capital BlueCross compete.

Pennsylvania Gov. Ed Rendell criticized Highmark’s decision to block the state’s review. “I am disappointed — but not surprised — that Highmark has chosen to fight our efforts to ensure the protection of consumers and guarantee a free and fair marketplace,” he said in a statement. “Health insurance is a big business. Historically, it has operated — and especially here in Pennsylvania — with limited regulation and weak oversight.”

http://www.ama-assn.org/amednews/2010/04/05/bisb0405.htm

Pennsylvania’s four BlueCross BlueShield plans have staked out different territories, effectively eliminating market competition between the Blues. One of the reasons that the reform model was based on private health plans was that market competition was supposed to bring us higher quality insurance products at lower costs. Instead, Pennsylvania is getting higher costs at whatever quality.

What is in the recently-enacted health reform legislation that will prevent such anti-competitive practices? The state health exchanges? This is an industry that is suing to block the release of any information about anti-competitive behavior. Just because they’ve been granted a new marketing tool in the form of the exchanges doesn’t mean that they are going to change their ways. The major markets are already concentrated amongst a few insurers, and they will continue to remain so.

Since we have lost the benefit of competition, why should we spend so much more merely to keep the private insurers in control? Let’s recover the resources that they waste and use the funds for a truly universal program that actually does cover all of us. That will require new, preemptive legislation, but it’s just what we need – an improved Medicare for everyone.

Shareholder group wants WellPoint to become not-for-profit

By J.K. Wall
Indianapolis Business Journal, April 6, 2010

Saying WellPoint Inc. has failed to live up to its commitment to provide “the best healthcare value” for customers, three shareholders of the Indianapolis-based health insurance giant want it to convert to a not-for-profit organization.

They have proposed that the company study the feasibility of such a conversion. The proposal will be voted on at WellPoint’s annual meeting of shareholders in Indianapolis on May 18.

The proposal was disclosed Friday in WellPoint’s proxy statement. The three shareholders—Rob and Karen Stone of Bloomington and Julia Vaughn of Indianapolis—will stage a press conference about the proposal Wednesday morning in front of WellPoint’s Monument Circle headquarters.

“WellPoint has had a heap of (well-deserved) bad publicity lately about their corporate culture of greed,” Rob Stone, an emergency physician at Bloomington Hospital, wrote in an e-mail. He referred to recent controversy over WellPoint’s premium hikes in California, Indiana and other states, and to Friday’s report that its executives enjoyed boosts in compensation last year ranging from 50 percent to 75 percent.

WellPoint’s board of directors urged shareholders to vote the proposal down.

“The proponent of this proposal has not presented any factual information to support the view that converting to nonprofit status would benefit us or our shareholders, employees, customers and members,” the board members wrote in a statement in WellPoint’s proxy filing. They said a feasibility study of the issue “would be costly and would distract management and the Board from overseeing our operations.”

Board members added that as a not-for-profit organization, the company would have poorer access to capital and, by not being able to pay executives with stock, would have a harder time attracting top-level managers.

WellPoint’s predecessor company, Anthem Inc., was a mutual insurance company until its initial public offering in 2001. It was, however, always a for-profit entity. Many of the companies acquired by Anthem or other WellPoint predecessors did convert from not-for-profit to for-profit status before being acquired.

The Stones and Vaughn would like to see the United States adopt a single-payer health insurance system, where the U.S. government would act as insurer for all Americans. Their proposal claims that WellPoint spends as much as 19 percent of its premium dollars on administration and profit, compared with about 3 percent spent on overhead by the federal Medicare insurance program for seniors.

“Although this is good for WellPoint’s profitability and share price, it supports the argument that for-profit health insurance is a major reason for the discrepancy in overhead expenses between the U.S. and other countries,” the shareholder proposal reads. “Nations with universal systems spend about half what we spend on a per-capita basis and have better health outcomes.”

During last year’s annual shareholder meeting, Rob Stone called informally for WellPoint’s board to re-mutualize the company.

[PNHP note: the statement below is the full text of Dr. Stone’s statement of April 7]

Press Conference Statement April 7, 2010

People ask me, why should WellPoint shareholders vote for the proposal that the company explore returning to its traditional Blue Cross, charitable, not-for-profit mission?

The reasons keep coming out in the newspapers, and let me mention a few from the last 12 weeks.

The Indianapolis Star on January 16 exposed that WellPoint has been covertly funding U.S. Chamber of Commerce attack ads against health care reform.  WellPoint spent tens of millions on other non-covert lobbying.  Keep in mind that the bill recently passed was largely written by former WellPoint Vice President Liz Fowler in her role as Max Baucus’ chief healthcare legislative aide.

McClatchy Newspapers on February 24:  ”While Anthem Blue Cross proposed a 39 percent rate increase on thousands of its California customers, its parent company gave 39 of its executives more than $1 million each and spent more than $27 million on 103 lavish executive retreats, congressional investigators said.”

The Los Angeles Times on March 10 updated its readers on the ongoing rescission scandal involving WellPoint in California. “Only a small fraction of eligible Californians have benefited from agreements that Anthem Blue Cross made to settle accusations that they systematically and illegally dropped sick policyholders to avoid paying for their care.”  These were people whose insurance coverage was cancelled after they were diagnosed with cancer and other serious conditions.

The Los Angeles Times again, on March 18 reported that in 2007 WellPoint had pledged through its charitable foundation to spend $30 million over three years to help those lacking health coverage, but its tax records and website show it gave only $6.2 million.

Consumer Watchdog reported March 31 that WellPoint sent a message to investors describing how it would simply re-label administrative costs as “medical care” in response to the new health reform law. The message follows revelations that WellPoint, also intentionally padded already huge premium increases in California, just in case regulators demanded reductions.

Also on March 31, Revive Public Relations released the results of its fourth annual national payer survey of hospital executives. Survey results showed a marked decline in WellPoint/Anthem’s reputation, now 2nd worst of all health insurance companies in their study.

And now this week the news of CEO Angela Braly’s 51% salary increase, up to $13.1 million.  The arrogance is overwhelming.  Why wouldn’t shareholders be concerned with the direction this company is heading?

Yesterday afternoon in Bloomington I listened to Allan Hubbard speak on health care reform at Indiana University.  Mr Hubbard, an Indianapolis businessman, served in the GW Bush administration and is a recent member of WellPoint’s Board of Directors.  

He made no bones about being a Republican and shared a Republican view on where health care reform should go from here.  At the end of his talk he concluded with this prediction: “My guess is that in 15 years we will have a single payer health plan, Medicare for All.”  He wasn’t saying that gleefully.

He explained that all the health insurance companies do is serve as middlemen between patients and providers, (doctors and hospitals).  He fears that as health care reform moves forward, Congress and the people will turn on them as a way to cut spending.  

They (we) should.  The health insurance industry adds huge administrative costs to our system, not to mention the profits they siphon off.  WellPoint is a parasitic middleman that adds no value, but actually increases the cost of healthcare for all of us.  

I see the day when socially responsible investors will divest themselves from health insurers’ stocks.

My recommendation is that WellPoint investors look at drastically changing the
direction of our company, and not wait for the stock price to plummet once the public figures out that insurance companies should go.

Rob Stone MD
Director, Hoosiers for a Commonsense Health Plan (http://www.hchp.info/)
State Coordinator and national Board member, Physicians for a National Health Program
Assistant Clinical Professor of Emergency Medicine, Indiana University School of Medicine

Saving Lives: Mammograms, Breast Cancer, and Health Insurance Reform

By Jeoffry B. Gordon, MD, MPH
Journal of the American College of Radiology
April 2010 (Vol. 7, Issue 4, Pages 243-245)

The vigorous controversy about the recent recommendation of the US Preventive Services Task Force (USPSTF) [1] against routine screening mammography for healthy, low-risk women aged 40 to 50 years has demonstrated our broad national consensus about the value of preventive medicine in general and breast cancer screening specifically. Nonetheless, many of the recent dissenting commentaries on this issue from concerned professionals [2], professional organizations [3], patients and their loved ones, and politicians have been narrowly focused and have tended to overlook important considerations. It is important to review this whole issue in the context of the actual use efficacy and consequences of screening mammography and its impact on breast cancer mortality.

In its new report, the USPSTF [1] recognized that “the risk for breast cancer increases with age. The 10-year risk for breast cancer is 1 in 69 for a woman at age 40 years, 1 in 42 at age 50 years, and 1 in 29 at age 60 years” (p 720). Its recommendation concerns “routine screening,” not mammography done for high-risk patients such as those who have breast masses, strong family histories, or abnormal genes or who may request screening.

The USPSTF updated its 2002 recommendations based on published data from a meta-analysis of randomized, controlled clinical trials that estimated the “‘number needed to invite for screening [for 10 years] to extend one woman’s life [prevent 1 death]’ as 1904 for women aged 40 to 49 years and 1339 for women aged 50 to 59 years” (p 719). For women aged 60 to 69 years, the number needed to invite is only 337, a markedly more focused risk assessment strategy. The USPSTF [1] recognized two important significant potential harms of screening mammography in younger women: first, false-positive results, which “can cause anxiety and lead to additional imaging studies and invasive procedures (such as biopsy or fine-needle aspiration). False-positive results . . . are more common in younger women” (p 721). Younger women are still menstruating and have denser breasts, which are harder to evaluate on mammography. Also, it is clearly necessary for every radiologist to read mammograms very conservatively and tend toward overcalling what they see so as not to miss a subtly abnormal truly positive finding. It would be inappropriate to try to eliminate false-positives. According to one of many studies of the issue [4], each mammogram has a6%to 10% chance of a false-positive result. In that study, the cumulative risk for a false-positive result after 10 mammograms was 56.2% for women aged 40 to 49 years at the time of the tests, compared with 47.3% for women aged 50 to 79 years. Furthermore, diagnostic workups after false-positives resulted in additional costs of 30% of the total costs for the initial screenings. In addition, for any medical test, the chance of a positive finding being truly positive is strongly dependent on the actual frequency of occurrence of the studied condition in the population tested. In statistics, this is known as Bayes’ rule. Its impact is especially important for screening tests, rather than diagnostic tests, because in screening, the true frequency of occurrence is low. Bayes’ rule clearly predicts that as the true frequency of a condition falls, even if the test is technically very good and valid, the number of false-positives rises and can quickly exceed the number of true-positives. Second, radiation exposure from mammography may increase the risk for breast cancer. A recent Dutch meta-analysis [5] presented in November 2009 (after the USPSTF report) on the experiences of 9,420 women with high-risk breast cancer genes, many of whom started undergoing mammography in their 20s, found that their risk for breast cancer was 2.5 times higher by a mean age of 45 years among those who had _5 mammograms than their counterparts who chose not to undergo mammography. Thus, considering the natural course of the disease in the total population of women, the effectiveness of mammographic screening, and the possible harms, the USPSTF [1] recommended “against routine screening mammography in women aged 40 to 49 years” (p 716).

The USPSTF (but this was not its task), its critics, and most of the public discussion about this issue have not considered the broader context of mammographic screening and breast cancer mortality. The deadly impact of the lack of health insurance has been completely overlooked. Uninsured women are much more likely to be diagnosed with advanced-stage breast cancer than their insured peers. As reported by the American Cancer Society [6], in 2005, whereas 75% of women aged 18 to 64 years with private insurance had undergone mammography in the past 2 years, only 33% of women uninsured for_12 months had undergone the test. Just 8% of insured women aged 18 to 64 years of all ethnic groups had stage III or IV (advanced or metastasized) breast cancer at diagnosis, compared with 18% of uninsured women. All breast cancer patients with private insurance had a 5-year survival rate of 89%, compared with only 77% in those who were uninsured. The lack of insurance coverage increases the likelihood that breast cancer will go undetected and, when found, be less responsive to treatment. The Institute of Medicine [7] put it another way: women without health insurance have a 30% to 50% higher risk for dying from breast cancer than women with private insurance. There will be much more benefit and less suffering if we can allocate our limited resources to providing full health insurance, including mammography, to all women on an evidencebased basis rather than focusing resources on continuing to provide screening mammography to a relatively low-risk group.

The importance of this perspective is both reinforced and highlighted by a series of studies that compared actual cancer survival in the United States (in Des Moines, Iowa) and Canada (in Winnipeg, Manitoba) [8,9]. From 1984 through 1997, “socioeconomic status and breast cancer survival were directly associated in the US cohort, but not in the Canadian cohort,” with statistically significant 14% better survival in Winnipeg, even among aboriginal people. The study compared residents of the lowest income areas in each city, presumably a proxy for poverty in both cities and lack of insurance only in the United States. It should be noted that during these years, 94% of Des Moines residents were classified as white, whereas _66% of Winnipeg’s were so classified. The authors noted that similar medical outcome differences exist in other American cities studied and for other cancers and are largest for patients aged_65 years. As they noted, this “seems to point compellingly toward the different health care systems in Canada and the United States as its most cogent explanation.”

Furthermore, the American Cancer Society, along with the Kaiser Family Foundation [10], documented 20 representative cases of cancer patients (7 with breast cancer) who were fully insured and called the American Cancer Society because they had to limit or give up treatment or even declare bankruptcy because of insurance policy copayments, deductibles, or policy limits. In fact, a recent study [11] showed that 62.1% of all personal bankruptcies were the result of illness or medical expenses. Imagine the predicament of a woman who is uninsured and who discovers a breast cancer through screening mammography or a self-examination. It is often very difficult for her to find safety-net providers to provide expeditious, quality, coordinated, appropriate treatment. There are even cases of women forgoing the opportunity of undergoing screening mammography for fear that something will be found, making them uninsurable when they get their next jobs.

The details of the controversy surrounding screening mammography and breast cancer mortality serve to hi
ghlight the importance of having a broad and comprehensive perspective on specific health care issues. We are all coming to grips with the realization that we must face illness and disease with limited resources. It is best that we devote our energies and resources to getting the most for our health care dollar. We must pay attention to the recommendations of evidencebased medicine, and the necessity for universal national health insurance could not be more clearly demonstrated.

Saving Lives: Mammograms, Breast Cancer, and Health Insurance Reform

REFERENCES

1. US Preventive Services Task Force. Screening for breast cancer: U.S. Preventive Services Task Force recommendation statement. Ann Intern Med 2009;151:716-26.

2. Thrall JH. US Preventive Services Task Force recommendations for screening mammography: evidence-based medicine of the death of science? J Am Coll Radiol 2010;7:2-4.

3. Lee CH, Dershaw DD, Kopans D, et al. Breast cancer screening with imaging: recommendations from the Society of Breast Imaging and the ACR on the use of mammography, breast MRI, breast ultrasound, and other technologies for the detection of clinically occult breast cancer. J Am Coll Radiol 2010;7:18-27.

4. Elmore JG, Barton MB, Moceri VM, Polk S, Arena PJ, Fletcher SW. Ten year risk of false positive screening mammograms and clinical breast exams. N Engl J Med 1998; 338:1089-96.

5. Jansen-van der Weide M, De Bock GH, Greuter M, et al. Mammography screening and radiation-induced breast cancer among women with a familial or genetic predisposition: a metaanalysis. Presented at: Annual meeting of the Radiological Society of North America; Chicago, Ill; November 30, 2009.

6. Ward E, Halpern M, Schrag N, et al. Association of insurance with cancer care utilization and outcomes. CA Cancer J Clin 2008; 58:9-31.

7. Institute of Medicine. America’s uninsured crisis: consequences for health and health care. Washington, DC: National Academies Press; 2009.

8. Gorey KM, Kliewer E, Holowaty EJ, Laukkanen E, Ng EY. An international comparison of breast cancer survival: Winnipeg, Manitoba and Des Moines, Iowa, metropolitan areas. Ann Epidemiol 2003;13:32-41.

9. Gorey K. Breast cancer survival in Canada and the USA: meta-analytic evidence of a Canadian advantage in low-income areas. Int J Epidemiol 2009;38:1543-51.

10. Schwartz K, Claxton G, Martin K, Schmidt C. Spending to survive: cancer patients confront holes in the health insurance system. Available at: http://www.kff.org/insurance/upload/7851.pdf. Accessed February 20, 2010.

11. Himmelstein DU, Thorne D, Warren E, Woolhandler S. Medical bankruptcy in the United States, 2007: results of a national study. Am J Med 2009;122:741-6.

Why are insurers buying back their shares?

Health plan profits: Relying on the market

By Emily Berry
American Medical News
April 5, 2010

Boosting earnings per share keeps Wall Street (and shareholders) happy. And in for-profit health insurance, shareholders come first.

When companies have extra cash, they think of the best way to benefit shareholders. “It is a fairly straightforward decision: they have dollars. They could potentially use those to buy new computers, hire new staff, open new markets, increase reimbursement or deliver more services, but in the for-profit world, their first obligation is returns to their owners,” said Joe Paduda, principal for the consulting firm Health Strategy Associates in Madison, Conn.

So how are they making money?

Administrative cost controls play some part. But there are other factors: First, insurers also make money from investing premium dollars, and the returns they make on those investments have stabilized since the market crash of 2008.

The other factor is plans’ billions of dollars worth of share buybacks, which affect the figure Wall Street watches most — earnings per share. Even if cash profits don’t change, per-share earnings will go up, because a company has fewer shares in the market.

Insurers’ investments and share buybacks matter, because they can indirectly affect doctors’ pay. If the market isn’t doing well and investment income drops, insurers feel even more shareholder pressure to raise premiums or cut costs, rather than risk an operating loss. That means less flexibility for doctors in negotiating reimbursements.

“They have less margin for error, because investment returns are so low,” Paduda said. If health plans see higher-than-expected spending, “or they sell a policy to folks who, God forbid, actually get sick, then they’ve got a problem.”

(Dave Shove, a New York-based senior research analyst specializing in managed care for BMO Capital Markets Equity Research Group) said share repurchases are simply a way to reward shareholders. Other options are paying dividends or buying other firms.

But health insurers historically have made very few dividend payments, he said, and “the health insurance business is pretty consolidated now. That just leaves one thing to do, and that is buy back stock, so they’re doing it.”

(Scott Harrington, PhD, professor of health care management at the Wharton School of the University of Pennsylvania) said health insurers, like other companies, have favored share repurchases over paying bigger dividends, in part because the tax code favors repurchases, but also because if shareholder dividends are increased one year then cut the next, the market interprets that as very bad news.

WellPoint Chief Financial Officer Wayne DeVeydt told investors at a March conference that the company plans to spend nearly $4 billion on share repurchases in 2010, following $2.6 billion in 2009.

Not everyone likes the way investments and stock prices drive the U.S. health care system. But short of a single-payer, government-controlled system, health system reform proposals are not aimed at changing this part of the way health insurance companies work.

“This is the world we live in,” Shove said. “These guys are for-profit, and as long as we have insurance companies, we have to live with the consequences of that.”

http://www.ama-assn.org/amednews/2010/04/05/bisa0405.htm

Comment: 

By Don McCanne, MD

When some of the non-profit Blues insurers converted to for-profit status, the primary reason given for that conversion was to open access to capital markets. What does that mean?

When a shareholder-owned corporation issues new stock, it is allegedly for the purpose of raising capital to expand operations, growing the industry and increasing profits. That is what capitalism is all about.

But when a corporation buys back stock, it is not for the purpose of contracting operations, but rather it is to pump up the per share value. It is not merely a coincidence that this increases the value of the large blocks of shares held by top management and the board of directors, by increasing the percentage of ownership in the company. New stock issues dilute ownership, whereas stock repurchases concentrate ownership.

The funds used to buy back the shares could have been used instead to slow the growth in premiums or to reduce the excessive cost sharing burden created by the shift towards underinsurance products, benefiting their customers – the patients. But no. As this article states, “shareholders come first.”

As Dave Shove states, “”This is the world we live in. These guys are for-profit, and as long as we have insurance companies, we have to live with the consequences of that.”

Perhaps the most important statement in this article: “… short of a single-payer, government-controlled system, health system reform proposals are not aimed at changing this part of the way health insurance companies work.”

The obvious conclusion is that reform should not stop short of a single payer system. We have more work to do.

Table: Health, life insurers hold $1.88 billion in fast-food stocks: AJPH article

Insurance
Company

Jack in
the Box

McDonald’s

Burger King

Yum! Brands

Wendy’s/
Arby’s Group

Total

Prudential plc

 

 

 

80.5

 
80.5

Prudential Financial

34.1

197.2

43.7

80.5

 
355.5

Mass Mutual

23.1

267.2

58.8

17.4

 
366.5

New York Life

2.4

 

 

 

 
2.4

Northwestern Mutual

40.9

318.1

 

63.2

 
422.2

Sun Life

 

 

 

26.8

 

26.8

Standard Life

 

63.0

 

 

 
63.0

ING

12.3

311.7

 

82.1

 

406.1

Manulife

 

89.1

 

53.7

3.3
146.1

Guardian Life

7.2

 

 

 

9.5
16.7

MetLife

 

 

 

 

2.2

2.2

Total

120.0

1,183.3

165.5

404.2

15.0

1,888.0

Why are insurers buying back their shares?

Health plan profits: Relying on the market

By Emily Berry
American Medical News
April 5, 2010
Boosting earnings per share keeps Wall Street (and shareholders) happy. And in for-profit health insurance, shareholders come first.
When companies have extra cash, they think of the best way to benefit shareholders. “It is a fairly straightforward decision: they have dollars. They could potentially use those to buy new computers, hire new staff, open new markets, increase reimbursement or deliver more services, but in the for-profit world, their first obligation is returns to their owners,” said Joe Paduda, principal for the consulting firm Health Strategy Associates in Madison, Conn.
So how are they making money?
Administrative cost controls play some part. But there are other factors: First, insurers also make money from investing premium dollars, and the returns they make on those investments have stabilized since the market crash of 2008.
The other factor is plans’ billions of dollars worth of share buybacks, which affect the figure Wall Street watches most — earnings per share. Even if cash profits don’t change, per-share earnings will go up, because a company has fewer shares in the market.
Insurers’ investments and share buybacks matter, because they can indirectly affect doctors’ pay. If the market isn’t doing well and investment income drops, insurers feel even more shareholder pressure to raise premiums or cut costs, rather than risk an operating loss. That means less flexibility for doctors in negotiating reimbursements.
“They have less margin for error, because investment returns are so low,” Paduda said. If health plans see higher-than-expected spending, “or they sell a policy to folks who, God forbid, actually get sick, then they’ve got a problem.”
(Dave Shove, a New York-based senior research analyst specializing in managed care for BMO Capital Markets Equity Research Group) said share repurchases are simply a way to reward shareholders. Other options are paying dividends or buying other firms.
But health insurers historically have made very few dividend payments, he said, and “the health insurance business is pretty consolidated now. That just leaves one thing to do, and that is buy back stock, so they’re doing it.”
(Scott Harrington, PhD, professor of health care management at the Wharton School of the University of Pennsylvania) said health insurers, like other companies, have favored share repurchases over paying bigger dividends, in part because the tax code favors repurchases, but also because if shareholder dividends are increased one year then cut the next, the market interprets that as very bad news.
WellPoint Chief Financial Officer Wayne DeVeydt told investors at a March conference that the company plans to spend nearly $4 billion on share repurchases in 2010, following $2.6 billion in 2009.
Not everyone likes the way investments and stock prices drive the U.S. health care system. But short of a single-payer, government-controlled system, health system reform proposals are not aimed at changing this part of the way health insurance companies work.
“This is the world we live in,” Shove said. “These guys are for-profit, and as long as we have insurance companies, we have to live with the consequences of that.”
http://www.ama-assn.org/amednews/2010/04/05/bisa0405.htm

When some of the non-profit Blues insurers converted to for-profit status, the primary reason given for that conversion was to open access to capital markets. What does that mean?
When a shareholder-owned corporation issues new stock, it is allegedly for the purpose of raising capital to expand operations, growing the industry and increasing profits. That is what capitalism is all about.
But when a corporation buys back stock, it is not for the purpose of contracting operations, but rather it is to pump up the per share value. It is not merely a coincidence that this increases the value of the large blocks of shares held by top management and the board of directors, by increasing the percentage of ownership in the company. New stock issues dilute ownership, whereas stock repurchases concentrate ownership.
The funds used to buy back the shares could have been used instead to slow the growth in premiums or to reduce the excessive cost sharing burden created by the shift towards underinsurance products, benefiting their customers – the patients. But no. As this article states, “shareholders come first.”
As Dave Shove states, “”This is the world we live in. These guys are for-profit, and as long as we have insurance companies, we have to live with the consequences of that.”
Perhaps the most important statement in this article: “… short of a single-payer, government-controlled system, health system reform proposals are not aimed at changing this part of the way health insurance companies work.”
The obvious conclusion is that reform should not stop short of a single payer system. We have more work to do.