Caroline Poplin, M.D., writing in Med Page Today, says that “Republican ‘repairs‘ are unlikely to make things better, either for the insurers or the currently insured.”
”Insurers will be able to charge their oldest customers five times more than younger ones for identical policies, and significantly reduce benefits in plans with lower premiums. There will be new restrictions preventing people from waiting until they are sick to sign up (insurers contend this is a big problem), but the IRS will not enforce the individual mandate, which was intended to force healthy people to sign up.
”So people will likely pay more for policies that cover less. Insurers will be able to charge higher premiums, but people who find the new policies too expensive may drop them without necessarily paying a penalty. If the healthy leave disproportionately, premiums will rise higher. This dynamic can result in a ‘death spiral,’ or simply the status quo ante, where insurers offer policies attractive to only the healthy and the wealthy; the poor and the sick, though they retain ‘access’ to health insurance, cannot afford it.
”But at the end of the day, what people want is not access to health insurance, but to affordable healthcare when they need it. It is not clear why policy analysts thought private for-profit insurers offering people a choice of plans would accomplish this.
”A choice of plans — so each family can choose the plan ‘best for it’– allows people to splinter the risk pool: healthy people at low risk can choose meager plans, forcing up the cost of more comprehensive plans the sick need. Also, the purpose of insurance is to cover the risk of a future event.”
“The fairest and most efficient way to get affordable healthcare for all is through social insurance, Medicare-for-all …just as Social Security ensures every American a modest retirement however long he or she lives. Everyone is in the same risk pool, everyone pays, everyone gets what they need.
“The healthy subsidize the sick, the rich help the poor, automatically. No money is diverted to insurance company underwriting, profits or administration. The federal government controls costs in a transparent, accountable way. People who hate government can sign up for Medicare Advantage.
“Although details vary, social health insurance works for every other developed country — each of which covers all its people and gets better health outcomes for far less than we pay. If that’s what we want, in the end, that’s what we must do.”
The price of American healthcare continues to surge, including for those who get their insurance via their employers.
The main elements are a “system” whose politically powerful constituencies benefit from economic incentives to maximize the number of procedures; for-profit insurers seeking to maximize profit and senior executives’ salaries; by far the world’s highest paid physicians, and hospital executives and astronomical drug prices
Thus healthcare premiums for employer-sponsored coverage have risen three times faster than wages even as deductibles and co-payments have soared.
These costs have wiped out most of the (small) wage gains that American workers have gotten since the turn of the last century.
Regina E. Herzlinger, a professor of business administration at Harvard University; Barak D. Richman, a professor of law and business administration at Duke University, and Richard J. Boxer, M.D., a professor at the David Geffen School of Medicine at UCLA, have proposed in The New York Times a way to address this and in so doing give American workers real raises.
They write:
“What if employers transferred to their employees the amount they now spend on coverage and the law allowed employees to deduct that spending from their taxes?
“And what if those laws allowed employees to opt not to spend that entire sum on health insurance, but instead take some home as wages? If an employee in a marginal tax bracket of 25 percent were given an $18,000 budget to purchase insurance, but opted for a plan that costs only $14,000, she could take an additional $3,000, post-tax, home to her family….
“Abundant research has shown that low- and middle-income workers have a strong preference for low-cost plans, much more than what their employers currently offer. If workers know they can increase take-home wages by purchasing less expensive insurance, they will demand more insurance options, and insurers are likely to respond. To avoid the chance that cash-strapped families purchase inadequate plans, insurance plans would have to meet the Affordable Care Act’s minimum standards. The law’s requirement to purchase insurance, with penalties for non-purchase, would lessen the possibility that workers would keep all the money rather than buy insurance.
“Freeing workers’ choices for insurance would also bring pressures on insurers to create new products that control costs, such as bundling of homeowners, auto and health insurances, or enabling people between 55 and 64 years old to access Medicare. State legislatures would feel similar pressures to adjust regulations to support competitive insurance marketplaces.”
“Stiffer competition and cost pressures on insurers, in turn, would force providers to offer more efficient care, such as by replacing outpatient and emergency room visits with telemedicine technology.”
Noam N. Leavey writes in governing.com that the mostly Red State politicians who denounce the Affordable Care Act for allegedly not working did all they could to ensure that the ACA would not work in their states.
“{T}hese same critics …took steps over the last several years to undermine the 2010 law and fuel the current turmoil in their insurance markets,” he writes.
“Among other things, they blocked expansion of Medicaid coverage for the poor, erected barriers to enrollment and refused to move health plans into the Obamacare marketplaces, a key step to bringing in healthier consumers.
“Those decisions left the marketplaces in many Red States with poorer, sicker customers than they otherwise might have had.
“Now, consumers are paying the price, as insurers seek major rate hikes or stop selling plans altogether.”
Lennox Hill Hospital, in Manhattan’s Upper East Side.
This HealthAffairs blog post by Michael Dowling, president and CEO of Northwell Health, which serves metropolitan New York, stems from “The New Health Care Industry: Integration, Consolidation, Competition in the Wake of the Affordable Care Act,” a conference held recently at Yale Law School’s Solomon Center for Health Law and Policy.
Among his remarks:
“Today, the lines delineating the many different stakeholders in the health business are increasingly blurred. Providers are becoming insurers and insurers are becoming providers. To achieve success in this new paradigm, all of us need to work more collaboratively, with the overarching goal of keeping people well and delivering care more appropriately to those who do get sick or injured. We need to provide people access to better, more-affordable care — outside of the hospital. To offer and manage care across the full continuum, you have to innovate and bring resources and pieces together to address the holistic nature of the person’s condition, not just the episodic nature of illness.”
“As president of the largest health system in New York, I am in the ‘health’ business. By default, that means I am also in the ‘hospital’ and ‘ambulatory services’ business, the ‘insurance’ business, the ‘education’ business, and the ‘research’ business, among others. That’s because all of these pieces contribute to the continuum of providing better health to the communities we serve.”
“We are also partners in an insurance company. People ask, ‘Why did you want to get into insurance?’ Like, somehow, we let the fox into the hen house. The answer goes back to being in the ‘health’ business. We want to have as much control as possible over the premium dollar so that we can manage people’s health and not just manage people’s illnesses. That way, when we reduce the utilization in a hospital, we get to keep some of the savings.”
“The old model was a terrible misalignment of incentives. We could do wonderful things to reduce hospital utilization, but if the insurance companies got the savings and left hospitals with the cost, where did that leave providers or their patients? By effectively being in the ‘insurance business’ and partnering in an insurance company, we can more appropriately align the incentives.”
“When I am asked what Northwell Health wants to be in the long term, my answer is: ‘I want to be in the health business, the health-promotion business, and the wellness business, as well as the illness care business. I want to be able to do all those things well.”’
“Despite the momentum, there are still plenty of gaps and question marks when it comes to telehealth policy. The 21 states without a parity {on provider reimbursement} law aren’t uniformly liberal or conservative. Kansas, South Carolina and Utah don’t have one, but neither do Illinois or Pennsylvania. Massachusetts, a state known for progressive healthcare policies, doesn’t have a parity law. It currently only covers telemedicine under Medicaid with certain managed care plans, and not for fee-for-service payments.
“Even among states that do have parity laws, the patchwork of policies can vary widely from one state to the next. Texas, for example, requires insurers to cover telehealth, but it mandates that a patient’s first appointment with a new doctor must be an in-person visit. Within Medicaid programs, about half of the states require that a patient be in a medical facility for telehealth appointments, rather than at home. The differences among states can be frustrating for telemedicine providers. Kofi Jones, vice president of public relations and government affairs for the telehealth company American Well, says she has 30 binders in her office filled with state-by-state regulations and legislation. …”
“Traditional health-care providers can be slow to integrate new technology. After all, almost half of doctor’s offices polled in 2013 still used paper records, according to a survey from the U.S. Department of Health and Human Services. Other recent surveys have found that only 2 percent of patients nationwide have access to video visits with their primary care physician. Less than half — 45 percent — even receive a traditional phone appointment reminder.”
Healthcare has emerged as one of the flash points in the Democratic presidential race.
Vermont Sen. Bernie Sanders has been a longtime supporter of a concept he calls “Medicare for All,” a health system that falls under the heading of “single-payer.”
Sanders released more details about his proposal shortly before the Democratic debate in South Carolina Sunday night. “What a Medicare-for-All program does is finally provide in this country health care for every man, woman and child as a right,” he said in Charleston.
Sanders’s main rival for the nomination, former Secretary of State Hillary Clinton, has criticized the plan for raising taxes on the middle class and said it is politically unattainable. “I don’t want to see us start over again with a contentious debate” about health care, she said Sunday night.
Some of the details of Sanders’s plan are still to be released. But his proposal has renewed questions about what a single-payer health care system is and how it works. Here are some quick answers.
What Is Single-Payer?
Single-payer refers to a system in which one entity (usually the government) pays all the medical bills for a specific population. And usually (though again, not always) that entity sets the prices for medical procedures.
Single-payer is not the same thing as socialized medicine. In a truly socialized medicine system, the government not only pays the bills but owns the health care facilities and employs the professionals who work there.
The Veterans Health Administration (VA) is an example of a socialized health system run by the government. It owns the hospitals and clinics and pays the doctors, nurses and other health providers.
Medicare, on the other hand, is a single-payer system in which the federal government pays the bills for those who qualify, but hospitals and other providers remain private.
Which Countries Have Single-Payer Health Systems?
Fewer than many people think. Most European countries either never had or no longer have single-payer systems. “Most are basically what we call social-insurance systems,” said Gerard Anderson, a professor at Johns Hopkins Bloomberg School of Public Health, who has studied international health systems. Social insurance programs ensure that almost everyone is covered. They are taxpayer-funded but are not necessarily run by the government.
Germany, for example, has 135 “sickness funds,” which are essentially private, nonprofit insurance plans that negotiate prices with healthcare providers. “So you have 135 funds to choose from,” Anderson said.
Nearby, Switzerland and the Netherlands require their residents to have private insurance (just like the Affordable Care Act does), with subsidies to help those who cannot otherwise afford coverage.
And while conservatives in the United States often use Britain’s National Health Service as the poster child for a socialized system, there are many private insurance options available to residents there, too.
Among the countries that have true single-payer systems, Anderson lists only two — Canada and Taiwan.
Are Single-Payer Plans Less Expensive Than Other Health Coverage Systems?
Not necessarily. True, eliminating the profits and duplicative administrative costs associated with hundreds of different private insurance plans would reduce spending, perhaps as much as 10 percent of the nation’s $3 trillion annual health care bill, Anderson said. But, he noted, once that savings is achieved, there won’t be further reductions in following years.
More important, as many analysts have noted, is how much health services cost and how those prices are determined. In most other developed countries, even those with private insurance, writes Princeton Health Economist Uwe Reinhardt, prices “either are set by government or negotiated between associations of insurers and providers of care on a regional, state or national basis.” By contrast, in the U.S., “the payment side of the health care market in the private sector is fragmented, weakening the bargaining power of individual insurers.”
Would Medicare For All Be Just Like The Existing Medicare Program?
No, at least not as Sanders envisions it. Medicare is not nearly as generous as many people think. Between premiums (for doctor and drug coverage), cost-sharing (deductibles and coinsurance) and items Medicare does not cover at all (most dental, hearing and eye care), the average Medicare beneficiary still devotes an estimated 14 percent of all household spending to health care.
Sanders’s plan would be far more generous, including dental, vision, hearing, mental health and long-term care, all without copays or deductibles (which has given rise to a lively debate about how to pay for it and whether middle-class families will save money or pay more).
WouldPrivate Insurance Companies Really Disappear Under Sanders’s Plan?
Probably not. Private insurers are fully integrated into Medicare, handling most of the claims processing and providing supplemental coverage through “Medigap” plans. In addition, nearly a third of Medicare beneficiaries are enrolled in private managed care plans as part of the Medicare Advantage program.
Creating an entirely new federal claims processing structure would in all likelihood be more expensive than continuing to contract with private insurance companies. However, Sanders makes it clear that insurers in the future would no longer be the risk-bearing entities they are today, but more like regulated utilities.
1. The three insurers in the program, called One Care, lost a combined $54 million in 18 months.
2. The goal of One Care, meant to coordinate services for 100,000 poor and disabled adults under 65 who are covered by both Medicaid and Medicare, is “to control costs and improve care by putting patients into a single, integrated health plan with a coordinator to help them navigate services.”
3. The three nonprofit insurers in One Care have so far enrolled fewer than 18,000 people.
4. Boston-based Commonwealth Care Alliance lost more than $40 million on the program, Watertown-based Tufts Health Plan nearly $1 million and Worcester-based Fallon Health about $13 million.
5. The financial challenges are forcing Fallon to drop out of One Care at the end of this September. As a result, Fallon plans to lay off 45 employees, leaving the state to reassign Fallon’s 5,400 members to other plans.
6. The participating payers attribute One Care’s financial losses to the difficulties of managing care for people with exceedingly complex lives: Many patients are homeless; many don’t speak English, and most have problems with addiction or mental illness.
7. Taxpayers will be required to cover much of the program’s financial losses — when healthcare spending is already straining the Massachusetts budget.
8. Insurers and state officials assert that it’s too early to tell whether One Care is improving members’ health.
In another sign of the increasing role of non-physician clinicians, Modern Healthcare reports, “o}ptometrists are working more closely with physicians and insurers to identify patients’ chronic conditions and make sure those patients receive appropriate medical care. They want to demonstrate that they have the training and skills to do more than just fit people for glasses and contact lenses.”
An example: “The Charlotte, N.C.-based Carolinas HealthCare System is working with Vision Source, a Kingwood, Texas-based network of 3,800 independent optometrists, to boost its performance in serving diabetes patients and raise its diabetes-care quality score.”
“Three white papers done at UnitedHealthcare found that eye-care professionals were effective in identifying patients with diabetes, high cholesterol, hypertension, juvenile rheumatoid arthritis and multiple sclerosis. ”
