May 22, 2013

Employers Eye Bare-Bones Health Plans Under New Law

Comment by Don McCanne of PNHP: Imagine health insurance not covering hospitalizations nor surgery. Yet this is still possible because the Affordable Care Act applies the essential health benefit requirement only to plans for small businesses and individuals and not to larger employers.

This has opened up the opportunity for a conspiracy between larger employers who could care less whether or not their employees have health insurance and private insurers who are quite willing to sell these almost worthless bare-bones products as long as there is a profitable market for them.

The solution is obvious. Cover all care that people need, and then provide that coverage to everyone, automatically. Maybe these uncaring employers might not like that, but when the taxes to pay for an equitable system are obligatory, they would get used to the idea of their employees being able to obtain health care when they need it. Not such a bad idea after all, especially when their competitors are treated the same.

May 16, 2013

Wendell Potter: GOP Candidates' Top Campaign Issue Will Be Obamacare 'Train Wreck'

Comment by Don McCanne of PNHP: Of those who are serious about health care reform, some want to abandon the Affordable Care Act (ACA) and immediately enact single payer, and others want to abandon the single payer cause and move full steam ahead with implementation of the ACA. But should we really abandon either approach?

It is clear that ACA alone will be grossly deficient. Thirty million people will remain uninsured, inadequate low actuarial value plans will become the new standard, and wasteful spending will continue because of the highly flawed, administratively complex model of ACA. So single payer should not be abandoned since it is an imperative if we want to have affordable health care for everyone.

Why shouldn't we abandon ACA? Because, quite simply, it is all that we have right now, and it will provide some limited relief for millions of people. If we were to abandon ACA now, mobilizing a social movement and then enacting and implementing single payer would still take many years - too long for those who would receive some benefit from ACA now.

So we should do both. Let the ACA enthusiasts continue with the implementation, while single payer forces step up the social movement for health care justice though advocacy for an improved Medicare for everyone.

So where is the train wreck? There isn't any. But Wendell Potter is right. The opponents of reform will latch onto every ACA implementation glitch, real or imagined, and onto the criticisms which will inevitably follow.

They will attempt to frame the implementation as a debacle, and run with that in their effort to use election politics to advance their anti-government agenda.

This complicates the message for the single payer camp. We need to educate people as to why ACA will fall intolerably short of reform goals, but we do not want that to become part of the Repeal ACA message. The opponents initially supported Repeal and Replace, but they have largely abandoned Replace, concentrating on Repeal. So how do we counter the Repeal message?

We need to emphasize the positive message of single payer - truly affordable health care for everyone. We can add that we don't need to repeal ACA since it can help some during the transition to single payer. But our action message should be Replace - letting the public know that we really do have a much better program that will work for everyone, whereas the opponents do not.

So perhaps a unifying message for the supporters of health care justic eshould be: Forget Repeal, REPLACE!

May 15, 2013

The Unhappy Marriage of Economics and Health Care

http://www.healthcare-now.org/the-unhappy-marriage-of-economics-and-health-care

America’s health care system is collapsing, and we can blame the Economics profession. Most economists approach health care in the wrong way, viewing it as a commodity like shoes or the laptop on which I write. Instead, health care is an idiosyncratic commodity, subject to uncertainty and “asymmetric information” leading to destructive behavior. Trying to force health care into a box, treating it like other commodities, economists have promoted cost sharing, market competition, and insurance oversight of health care providers that have inflated the administrative burden while denying ever more Americans access.

Health care spending has been rising throughout the world as aging and more affluent populations spend on their health. Nowhere, however, has the cost of health care risen as fast as in the United States where costs soared because of rising administrative expense. Compared with other affluent countries in the Organization for Economic Cooperation and Development (the OECD), the United States spends over twice as much per person as is spent elsewhere. Before 1971 when Canada enacted its Medicare program, a single-payer government funded health care system, Canada spent a higher share of its national income on health care than did the United States; since then, however, while Canada has controlled costs, spending has soared in the United States so that we now spend over $3000 more per person. That is $12,000 for a family of four that is not available for travel, education, housing, or food.

Elsewhere, increases in health care spending have been associated with improvements in the provision of health care and, therefore, go with increasing life expectancy. In the United States, however, spending has increased because of rising administrative costs and increases in the price of prescription drugs and, therefore, has yielded relatively few benefits in improvements in care. Comparing changes in health-care spending and life expectancy between 1971 and 2008, other affluent OECD members gained a year of life expectancy for every $453 in spending; in the United States, however, life expectancy has increased less and spending has risen sharply more so that each year of increased life expectancy has cost over twice as much as in these other countries. Health care spending in the United States has increased by $1283 for every additional year of life expectancy; had our spending per year of added life increased at only the rate of other countries we would be spending over $4500 less per person, $18,000 saved for the average family of four. Most of the difference in relative expenditures, most of the growing waste in spending in the United States, is due to increasing administrative costs in the provision of private health insurance and in the billing and insurance operations within doctors’ offices and in hospitals. The average physician in the United States now spends four-times as much interacting with insurance companies as does the average physician in Ontario, Canada, over $80,000 per physician compared with a little over $20,000 in Ontario. Prescription drug prices and administrative expenses have been the fastest rising costs in the United States health care system; from 1980 to 2005, administrative costs rose by 1300% while drug prices rose by nearly 2000%. There are now 2.5 million administrative support personnel in the American health care system; more than the number of nurses, and five times the number of physicians. We now have more health-care managers than physicians and surgeons.

May 13, 2013

American Health Care as a Source of Humor

http://economix.blogs.nytimes.com/2013/05/10/american-health-care-as-a-source-of-humor/?src=rechp&pagewanted=print

Uwe E. Reinhardt is an economics professor at Princeton. He has some financial interests in the health care field.

From time to time I stand accused of injecting humor into my public presentations on health policy in the United States. As a German-born economist, I find it hurtful.

Germans pride themselves on their lack of humor. Economists, for their part, pride themselves on being practitioners of the dismal science. We are the professional buzzkills who put caveats on any good news.

Now imagine both traits packaged into one human being: you have yours truly. It is not that I inject humor into our otherwise august debate on health policy. Rather, the health system in the United States is in many ways so risible that it comes across as droll even when a dour German-born economist describes it.

One of those risible moments occurred this week when the Centers for Medicare and Medicaid Services of the Department of Health and Human Services delivered agiant spreadsheet on hospital charges and payments.

The spreadsheet has data in 65,536 rows and 12 columns. It covers, for each of more than 3,000 hospitals, charges and payments for the 100 most frequently billed inpatient cases, along with the average covered charges hypothetically billed by those hospitals for those cases.

<snip>

Why was this news? That charges vary enormously among hospitals surely must have been known for many years. As early as 2004, for example, Lucette Lagnado of The Wall Street Journal reported that on the paper’s front page.

I recall producing from her data, for a 2006 paper, “The Pricing of U.S. Hospital Services: Chaos Behind a Veil of Secrecy,” the following slide. (see link) More such wondrous charges can be found in Ms. Lagnado’s article.

Perhaps the news in this case was that at long last the government had bestirred itself to publish data on which it had been sitting for decades. Indeed, why it had not done so eons ago is an intriguing question.

May 8, 2013

What if we still calculated cost of living adjustments (COLAs) for Social Security the way we did in

--the 70s?

From the book Worse Than You Think (the real economy hidden beneath Washington’s rigged statistics, and where to go from here) by Keith Quincy, Professor of Economics at Eastern Washington University. ISBN 978-0-9838797-1-8-51800, pp 158-168.

This is an executive summary of the chapter on Social Security and retirement income. I strongly recommend the entire book.

If we calculated COLAs according to methods in use before 1980, Social Security and other benefits would be twice what they are today. How did Reagan and subsequent administrations manage to ignore the real increases in the cost of living?

First, they substituted rental price inflation for inflation of housing prices. As every realtor knows, whenever house prices go up, rental prices go down. When interest rates fall, more people can afford the monthly payments on a new home. So they go shopping for a new house. The higher demand causes house prices to go up. With people moving out of rentals into new homes there are many vacancies. To fill them back up, landlords lower rents. You see the connection. House prices go lip, rents go down. Rents are therefore a terrible gauge of house prices.

On the other hand, using rental costs as a measure of house prices is a great way to make house inflation disappear. It also takes an enormous bite out of the overall inflation numbers. Housing costs take up almost 30 percent of the CPI. The switch from house prices to rental costs in 1983 cut the CPI from 6.2 percent down to 4.3 percent

In 2008, the average Social Security income was $10,189 when it should have been $21,405.

Was the lower number of $10,189 enough to keep a person out of poverty? Not according to the government’s own poverty guidelines. That year, the poverty threshold for someone sixty-five or older was $10,326. Apologists for cutting Social Security income insist that seniors have many other sources of income. But do they?

What about private pensions? Formerly defined benefit pensions were the norm, but today only 13 percent of those close to retirement have this kind of pension. Those who have pensions at all have 401(k)s, or defined contribution pensions.

Today, both types of private pensions are in bad shape. Defined benefit pensions don't pay much because they are underfunded. And defined contribution plans have lost money. Many were invested in stocks and bonds backed by bad mortgages. When the stock market crashed and the housing market went bust, these plans lost tons of money. As a result, private pensions don't pay very much to retirees. Let's look at 2008. For people sixty-five and older, most (65 percent) got no pension money at all. And for those who had pensions, most didn’t get very much. The average was $4,768 a year.

What about inheritance money? Could this make a difference? Not likely! One study found that only 15 percent of people close to retirement expect to get any inheritance. And it isn't very much. Of the few who get something, only 2 percent wound up with more than $100,000. So most people won't get much, if anything at all, from dead relatives.

There is another possible source of retirement income, the equity a person has built up in a home. In late 2000, the housing market took off The Federal Reserve had lowered the interest rate it charged banks for money. The drop was big, from 6.5 percent down to 3.5 percent. Banks passed the savings People of retirement age (sixty-five and older) already feel the pinch. Most cannot count on any money from the equity in their home. And for those who do have some equity, the income it provides is small. The average is less than $5,000 a year.

What about wages earned after retirement? Does this make a difference? A recent survey found that 72 percent of workers planned to be employed after they retire. But seniors have a hard time finding full-time work. Most who are employed work part time and what they earn amounts to only 2 percent of what they receive from Social Security and a private pension, if they have one. As a result, they cannot count on much help from finding a job.

Even with an honest inflation adjustment that almost doubles Social Security benefits, most seniors would still fall below the poverty threshold. Nor would they break this barrier after padding their Social Security payments with income from a private pension, home equity, and wages. The extra income would boost their total to only $17,665, still short by more than $2,000 of breaking through a poverty threshold of $19,710. This bare bones income is not even what retirees receive today. It is what they would get if the COLA adjustment was accurate instead of rigged.

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May 6, 2013

Aetna will drop out of health insurance exchanges if they are not profitable enough

Comment by Don McCanne of PNHP: In this quarterly earnings conference call, Aetna's Mark Bertolini and Shawn Guertin demonstrate their executive skills in guiding this large insurance corporation in the direction of providing the greatest returns for the investors. From a corporate governance perspective, that's exactly as it should be. How well does that work from the perspective of our health care system?

Chief Financial Officer Guertin says that they will favor "margin over membership." That is, they will sacrifice the option of bringing more people under the insurance umbrella in exchange for greater profits for the Aetna investors. Is limiting access to the payer of health benefits a policy decision that we want driving our health care system?

Chairman Bertolini says that they intend to reduce the size of their already-limited provider networks by one-half to three-fourths in order to use that leverage to squeeze payment rates for their remaining providers. So they are deliberately removing choices that patients would have in selecting their health care professionals and institutions for the purpose of increasing their margins (profits). Is impairing access by restricting choice a policy decision that we want made for our health care?

Chairman Bertolini also says that they will continue to hold onto the option of pulling out of the exchanges if they do not "develop favorably" or if "they ask for unreasonable rates." Is this a policy to take care of patients, or one to take care of investors?

Imagine a public single payer program, such as an improved Medicare that covered everyone. "Margin over membership" would be unheard of. As a universal system, everyone would be included. It would be inconceivable that the stewards of the system would limit the numbers enrolled as a means of generating more favorable balance sheets.

It's the model that's wrong. We need to change it.

April 26, 2013

I Am A Republican … Can We Talk About A Single Payer System?

By David May, M.D.
American College of Cardiology Touch Blog, April 23, 2013

I am a Republican. For those who know me that is not a surprise. I live in a red state. I have never voted for a Democratic presidential candidate. I can field strip, clean and reassemble a Remington 12-gauge pump blindfolded. And on top of it, I think we should talk about having a single payer national health care plan. The reason is quite simple. In my view, we already have one; we just don’t take advantage of it.

Firstly, Medicare and the Center for Medicare and Medicaid Services (CMS) are de facto setting all of the rules now. They are a single payer system. When we go to lobby the Hill, we lobby Congress and CMS. Talking to Blue Cross, Aetna, Cigna and United Health care is essentially a waste of time. All the third party payers do is play off the Medicare rules to their advantage and profit. They have higher premiums, pay a somewhat higher benefit and have a significantly higher level of regulation which impedes the care of their customers. This is no longer consumer choice but effectively extortion, a less than hidden shake down in which the “choice” for a family of four is company A at $900 per month or company B at $1100 per month. The payers are simply taking advantage of the system, playing both ends against the middle.

http://www.pnhp.org/print/news/2013/april/i-am-a-republican-can-we-talk-about-a-single-payer-system

April 25, 2013

Resolution Against the Confiscation of Customer Bank Accounts by “Systemically Important” Banks

Steal it and use it however you like.

All LD and county Democratic Party organizations should consider this resolution

Resolution Against the Confiscation of Customer Bank Accounts by “Systemically Important” Banks

WHEREAS the 2008 financial bailout has committed American taxpayers to permanent, blind support of an ungovernable, non-regulated, hyper-concentrated new financial system that exacerbates the behavior of bankers that caused the crash; and

WHEREAS Attorney General Eric Holder has publicly stated that he will not prosecute the clearly criminal behavior of large financial institutions because “it will have a negative impact on the national economy;” and

WHEREAS since the bailout these banks have become even larger and are still engaged in the same risky behavior as before; and

WHEREAS European austerity hawks have recently required Cyprus banks to confiscate money from the accounts of customers to essentially repay what are gambling debts of those banks; and

WHEREAS a joint paper by the U.S. Federal Deposit Insurance Corporation and the Bank of England dated Dec. 10, 2012 recommends the confiscation of customer deposits on the grounds that these institutions no longer have the resources to do a bailout which is expected to be even larger than that of 2008; and

WHEREAS Canada, New Zealand, Spain and other countries have proposed similar policies, indicating that this will be the default policy of the entire global financial elite; and

WHEREAS enabling legislation in the US has not yet been proposed or passed by Congress;

THEREFORE BE IT RESOLVED that _________ call on our Democratic representatives to not only refuse to make American bank depositors liable for the gambling debts of vastly overpaid financial operators, but to originate and pass legislation specifically forbidding this; and

THEREFORE BE IT FURTHER RESOLVED that _________ call on our Democratic representatives to reinstate financial regulation of large banks and investment firms; and

THEREFORE BE IT FURTHER RESOLVED that _________ direct our Democratic National Committee representatives put this issue on the agenda of the DNC; and

THEREFORE BE IT FINALLY RESOLVED that the ________ send copies of this resolution to the members of our Democratic Congressional delegation, Senate Majority Leader Harry Reid, House Minority Leader Nancy Pelosi and Attorney General Eric Holder.


REFERENCES
http://www.fdic.gov/about/srac/2012/gsifi.pdf
http://readersupportednews.org/opinion2/277-75/15395-secret-and-lies-of-the-bailout
http://www.nationofchange.org/it-can-happen-here-confiscation-scheme-planned-us-and-uk-depositors-1364735979

April 24, 2013

Governments may push workers to health exchange

http://www.pressherald.com/news/Governments-may-push-workers-to-health-exchange-.html

OLYMPIA, Wash. — In a move that would capitalize on provisions under President Barack Obama's health care law but could cost the federal government millions of dollars, Washington state lawmakers have found a creative way to pass a large chunk of their health care expenses along to Washington, D.C. – and analysts say others are likely to follow suit.

The plan threatens to affect the federal budget and the pocketbooks of some part-time workers, as it would push a group of employees out of their current health care plans and into an exchange developed under the Affordable Care Act.

Observers say the shift seems to run counter to the intent of the new health care law. Supporters, however, say it's a viable strategy for governments to pursue as they manage the insurance rules related to part-time staff.

Washington state appears to be the first major government to seriously explore the possibility of pushing workers into the exchange — but it probably won't be the last. Rick Johnson, who advises state and local governments on health care policy at the New York-based consulting firm Segal Company, said he expects it will be an option some governments will look at in the years to come.
"I can see that as one of the solutions out there," Johnson said.

A spokeswoman with the Department of Health and Human Services declined comment, and it's unclear whether the federal government accounted for this possible outcome.

While Democratic lawmakers have expressed concern about the Washington state plan this year, it is drawing growing interest among a bipartisan group of political leaders in the state. Democratic Gov. Jay Inslee, who supported the Obama health care law while in Congress, has reservations about the plan.
But the former congressman said federal rules don't dictate how employers and employees should handle insurance coverage and indicated that he may consider supporting the idea in the future.

"It's one of those ideas that's premature for us to launch this year, but I don't think we should take it off the table," Inslee said Tuesday.

The Washington state proposal has come before lawmakers as governments around the nation are formulating strategies to manage those who don't work 40 hours a week, since the federal law requires employers to provide coverage for those working at least 30 hours.

Virginia, for example, is requiring all part-time employees to work fewer than 30 hours, which will help the state avoid penalties for not providing health coverage. Florida, facing a potential $300 million penalty for not covering workers who have 30 to 39 hours a week, is moving to extend coverage to those employees.

Washington state is in a less common situation, since it already provides coverage for part-timers down to 20 hours a week

April 22, 2013

Medicare: one size really does fit all

http://jama.jamanetwork.com/multimedia.aspx#AuthorInterviews



Comment by Don McCanne of PNHP: Hmmm.

"It is just unbelievable what an administrative nightmare the Affordable Care Act has become."

"...they always tell me, oh, one size doesn't fit all. Well, tell that to McDonald's or to the Holiday Inn."

"...but I'm saying on some issues we really, in my view, should have national policies because it would be much more easy to administer."

"We said no matter where the elderly live, they should have the same deal in health care, and we created Medicare. Has Medicare been that much of a disaster?"

So can we draw the conclusion that we should adopt the administrative simplicity of a national, one-size-fits-all Medicare that gives everyone the same deal in health care? Seems like a really good idea.