I have included the following presentation by Uwe Reinhardt and Tsung-Mei Cheng that I clipped from the August 11 "Quote of the Day" from Don McCanne. It is an excellent summary of the politics of health care in the US, and goes a long way toward explaining why they are so difficult, and why such seemingly little progress is being made.
Click the hotlink at the end of the excerpt to go the more complete original presentation. Well worth the trouble.
-SPC
Altarum Center for Sustainable Health Spending
July 12, 2016
THE NEXT DEBATE IN HEALTH CARE:
Transforming the Ethical Structure of U.S. Health Care
A presentation by Uwe E. Reinhardt and Tsung-Mei Cheng
(Excerpts)
The theme of these Altarum symposia has been what can be done to make our health system – especially spending thereon – “sustainable.”
I. “SUSTAINABILITY” IN U.S. HEALTH CARE
“Sustainability” is a much-mouthed word, although few people using the word actually define it. We can think of at least two distinct meanings in the context of health care:
A. Economic sustainability – the ability of the macro-economy to absorb further growth in health spending;
B. Political sustainability – the willingness of families in the upper-income strata to subsidize through taxes or health insurance premiums the health care of families in the lower income strata.
Total health spending is the product of health-care utilization and prices.
Under our system of governance, in which the sympathy of politicians literally can be purchased retail, it has been very difficult to control prices overall, other than in government programs.
Indeed, because prices for identical services or products vary enormously across the U.S., within regions and even within cities, it is hard even to measure what prices actually are in this country. What price is representative?
So the focus of health-care cost containment in the U.S. naturally has been and will continue to be mainly on health-care utilization.
The question then becomes whose ox is likely to be gored in our quest to reduce utilization – that is, who will be asked to do most of the belt tightening in health-care.
That question will be the focus of our presentation.
We shall abandon erstwhile dreams of an egalitarian health-care system and instead develop platforms that will allow policy makers to ration health care by income class, without ever openly saying so or debating that policy. By 2030 at the latest these new platforms are likely to be cemented in place.
II. ETHICAL PERSPECTIVES ON U.S. HEALTH CARE
ALTERNATIVE VIEWS ON THE PROPER DISTRIBUTIVE ETHIC FOR AMERICAN HEALTH CARE:
U.S. Progressives: A PURE SOCIAL GOOD TO BE AVAILABLE TO ALL ON EQUAL TERMS AND TO BE FINANCED BY ABILITY TO PAY
U.S. Conservatives: A PRIVATE CONSUMPTION GOOD WHOSE FINANCING IS PRIMARILY AN INDIVIDUAL RESPONSIBILITY
Although anyone can clearly discern these sharply different views on the distributive social ethic of U.S. health care, Americans are invariably reluctant ever to debate them openly, because that could be divisive.
So we talk about the distributive ethic of our health system in code words where, for example, “freedom of choice” may be just code for “you should make do with whatever financial resources you may have, but you are free to deploy them any way you want.”
To progressives, the very idea of rationing health care by income class is anathema – hence their penchant for a single-payer system that at least tries to be egalitarian.
To conservatives, rationing by income of the timeliness, amenities and quality of health care does not seem anathema, because we routinely apply it to other basic necessities such as food, clothing, housing, education and even the administration of justice. Why should health care be different?
Between these more extreme views on the ethics of health care is the confused, large group of citizens without firm views, at least as long as they are healthy.
Correlated with the views on the distributive ethics of health care are views concerning the degree to which the supply side of the health care market should be allowed to extract the maximum revenue from the rest of society through their pricing policies.
Health policy in the past 40 years basically has been a civil war between the two more extreme views on health care, although, as noted, we have debated it mainly in code words, given our reluctance to confront ethics forthrightly.
On the ground, this civil war has taken the form of a myriad of small legislative skirmishes at the federal and state levels, giving victory sometimes to one side and at other times to the other side.
Overall, however, victory has gone to the conservative side.
III. BUILDING THE PLATFORM FOR RATIONING HEALTH CARE BY INCOME CLASS
So what do we need in the structure of a health system designed to ration health care by income – at least a good bit of it? We need two distinct platforms:
A. we need a platform for varying the quality of the health insurance policy by income class, and
B. we need high cost sharing by patients at point of service, to ration health care utilization when illness strikes.
If you think of it, we have been busily building these two platforms during the past 20 or so years, brick by brick.
A. TIERING INSURANCE PRODUCTS BY INCOME CLASS
Health insurance exchanges – public or private – are the ideal platforms for tiering the quality of health insurance by income class. ObamaCare explicitly acknowledges it with its metal tiers.
The instruments for tiering here are
- narrowness of the network of providers
- narrowness of the drug-formularies
- limits on services covered
- other features of the benefit package
The often proposed conversion of the egalitarian Medicare program from its defined benefit structure to a defined contribution structure (the premium support model) is one of the bricks for the desired platform.
Likewise, the idea to move Medicaid beneficiaries out of that defined benefit program onto the insurance exchanges can be interpreted in the same way.
Finally, the conversion of employment-based health insurance from defined benefit to defined-contribution plans, coupled with private health insurance exchanges, is another brick in the strategy.
It will finally permit the quality of health-insurance coverage within a company to vary by income level.
B. TIERING HEALTH CARE BY INCOME CLASS AT POINT OF SERVICE
High-deductible health insurance policies are ipso facto an instrument for rationing health care by income class, unless the deductible were closely linked to income.
One does not need a Ph.D. in economics to realize that a low income family confronted with a high deductible will tighten its belt in health care much more than would a high income family confronting the same deductible.
Similarly, under our progressive income-tax structure, the idea of tax-preferred Health Savings Accounts (HSAs) ipso facto makes health care for high income people cheaper than for low income people – an amazing ethical proposition.
IV. U.S. HEALTH CARE CA. 2030
At this time, the gradual transformation of our health-care system into one that allows us to ration health care by income is not yet complete.
Part of the problem is that it is not yet politically correct for politicians or the policy wonks who advise them openly to state that rationing by income class is their goal.
The desired structure therefore has to be developed quietly, and so that the general voting public does not know what is happening to their health system.
Indeed, sometimes the steps toward this goal are marketed to the voting public in classic Orwellian lingo – e.g., “Consumer Directed Health Care” (CDHC) that will “enable consumers [formerly patients] to sit in the driver’s seat in health care to shop around for cost-effective care.”
Absent solid, consumer-friendly information on binding prices and the quality of health care produced by different providers of health care – still typically the norm in the U.S. – CDHC actually has turned out to be a cruel hoax.
For the most part, CDHC has been merely an instrument to ration health care by income.
We came across the following paper that goes along with our thesis on rationing: “Wealthy spending more on health care than poor and middle class, reversing trend”
V. CONCLUDING REMARKS
It is not our place to render a value judgment on the merits of this development. That is a matter of ideology and of ideas of what is a “just society.”
But register our amazement — almost our admiration — at the ease with which one faction of the nation’s elite has been able to further this transition – a development of which the voting public hardly seems aware (except when illness strikes).
It can be doubted that the general populace of other countries – France, Germany, the U.K., Canada – would accept this transition with such astounding equanimity.
It is only of recent that the American public seems to have lost faith in the wisdom and beneficence of the nation’s policy-making elite.
We shall see how far that elite can push rationing health care by income before the American public becomes fully alert to that policy.
In an honest referendum, with full knowledge of what is underfoot, the general voting public probably would not support a move to rationing more and more health care by income.
More likely the voting public would opt for a more egalitarian system, which can explain why it is not yet politically correct for politicians openly to advocate rationing health care by income.
“Americans Overwhelmingly Prefer This Presidential Candidate’s Healthcare Plan, Study Shows”
According to Gallup… the overwhelming favorite was the single-payer plan offered by Bernie Sanders. Overall, 58% of respondents favored the idea, with just 37% opposing it and another 5% having no opinion.
In a separate question, Gallup asked respondents to choose between putting a single-payer system in place versus keeping Obamacare in place,and single-payer won by an even broader margin — 64% to 32%.
===
Comment by Don McCanne
Everyone should master understanding the concept presented here. Should the distributive ethic in health care represent a social good for all or an individual responsibility for each of us?
We are transitioning further into the individual responsibility ethic through the platforms of tiering insurance by income (narrow networks and limited benefits) and tiering health care by income at the point of service (high deductibles, health savings accounts, and consumer-directed health care). Thus we are rationing health care by ability to pay, and that will only increase further as we expand our current health care policies. Too many people will not be receiving the care that they should have.
This slide set was expanded to include some of the narrative so that we can understand better how our current approach to sustainability is political rather than economic - supporting an ethic that preserves the wealth of the wealthy by suppressing redistribution, while making the health care system sustainable by making health care less affordable for the majority.
This presentation by the insightful team of Uwe Reinhardt and Tsung-Mei Cheng should be downloaded and shared with as many other concerned individuals as possible. We need to deliver the egalitarian message that the people of other nations take for granted: we can have health care for everyone in a system that is truly sustainable.
I have included the following presentation by Uwe Reinhardt and Tsung-Mei Cheng that I clipped from the August 11 "Quote of the Day" from Don McCanne. It is an excellent summary of the politics of health care in the US, and goes a long way toward explaining why they are so difficult, and why such seemingly little progress is being made.
Click the hotlink at the end of the excerpt to go the more complete original presentation. Well worth the trouble.
Click the hotlink at the end of the excerpt to go the more complete original presentation. Well worth the trouble.
-SPC
Altarum Center for Sustainable Health Spending
July 12, 2016
THE NEXT DEBATE IN HEALTH CARE:
Transforming the Ethical Structure of U.S. Health Care
A presentation by Uwe E. Reinhardt and Tsung-Mei Cheng
(Excerpts)
The theme of these Altarum symposia has been what can be done to make our health system – especially spending thereon – “sustainable.”
I. “SUSTAINABILITY” IN U.S. HEALTH CARE
“Sustainability” is a much-mouthed word, although few people using the word actually define it. We can think of at least two distinct meanings in the context of health care:
A. Economic sustainability – the ability of the macro-economy to absorb further growth in health spending;
B. Political sustainability – the willingness of families in the upper-income strata to subsidize through taxes or health insurance premiums the health care of families in the lower income strata.
Total health spending is the product of health-care utilization and prices.
Under our system of governance, in which the sympathy of politicians literally can be purchased retail, it has been very difficult to control prices overall, other than in government programs.
Indeed, because prices for identical services or products vary enormously across the U.S., within regions and even within cities, it is hard even to measure what prices actually are in this country. What price is representative?
So the focus of health-care cost containment in the U.S. naturally has been and will continue to be mainly on health-care utilization.
The question then becomes whose ox is likely to be gored in our quest to reduce utilization – that is, who will be asked to do most of the belt tightening in health-care.
That question will be the focus of our presentation.
We shall abandon erstwhile dreams of an egalitarian health-care system and instead develop platforms that will allow policy makers to ration health care by income class, without ever openly saying so or debating that policy. By 2030 at the latest these new platforms are likely to be cemented in place.
II. ETHICAL PERSPECTIVES ON U.S. HEALTH CARE
ALTERNATIVE VIEWS ON THE PROPER DISTRIBUTIVE ETHIC FOR AMERICAN HEALTH CARE:
U.S. Progressives: A PURE SOCIAL GOOD TO BE AVAILABLE TO ALL ON EQUAL TERMS AND TO BE FINANCED BY ABILITY TO PAY
U.S. Conservatives: A PRIVATE CONSUMPTION GOOD WHOSE FINANCING IS PRIMARILY AN INDIVIDUAL RESPONSIBILITY
Although anyone can clearly discern these sharply different views on the distributive social ethic of U.S. health care, Americans are invariably reluctant ever to debate them openly, because that could be divisive.
So we talk about the distributive ethic of our health system in code words where, for example, “freedom of choice” may be just code for “you should make do with whatever financial resources you may have, but you are free to deploy them any way you want.”
To progressives, the very idea of rationing health care by income class is anathema – hence their penchant for a single-payer system that at least tries to be egalitarian.
To conservatives, rationing by income of the timeliness, amenities and quality of health care does not seem anathema, because we routinely apply it to other basic necessities such as food, clothing, housing, education and even the administration of justice. Why should health care be different?
Between these more extreme views on the ethics of health care is the confused, large group of citizens without firm views, at least as long as they are healthy.
Correlated with the views on the distributive ethics of health care are views concerning the degree to which the supply side of the health care market should be allowed to extract the maximum revenue from the rest of society through their pricing policies.
Health policy in the past 40 years basically has been a civil war between the two more extreme views on health care, although, as noted, we have debated it mainly in code words, given our reluctance to confront ethics forthrightly.
On the ground, this civil war has taken the form of a myriad of small legislative skirmishes at the federal and state levels, giving victory sometimes to one side and at other times to the other side.
Overall, however, victory has gone to the conservative side.
III. BUILDING THE PLATFORM FOR RATIONING HEALTH CARE BY INCOME CLASS
So what do we need in the structure of a health system designed to ration health care by income – at least a good bit of it? We need two distinct platforms:
A. we need a platform for varying the quality of the health insurance policy by income class, and
B. we need high cost sharing by patients at point of service, to ration health care utilization when illness strikes.
If you think of it, we have been busily building these two platforms during the past 20 or so years, brick by brick.
A. TIERING INSURANCE PRODUCTS BY INCOME CLASS
Health insurance exchanges – public or private – are the ideal platforms for tiering the quality of health insurance by income class. ObamaCare explicitly acknowledges it with its metal tiers.
The instruments for tiering here are
- narrowness of the network of providers
- narrowness of the drug-formularies
- limits on services covered
- other features of the benefit package
The often proposed conversion of the egalitarian Medicare program from its defined benefit structure to a defined contribution structure (the premium support model) is one of the bricks for the desired platform.
Likewise, the idea to move Medicaid beneficiaries out of that defined benefit program onto the insurance exchanges can be interpreted in the same way.
Finally, the conversion of employment-based health insurance from defined benefit to defined-contribution plans, coupled with private health insurance exchanges, is another brick in the strategy.
It will finally permit the quality of health-insurance coverage within a company to vary by income level.
B. TIERING HEALTH CARE BY INCOME CLASS AT POINT OF SERVICE
High-deductible health insurance policies are ipso facto an instrument for rationing health care by income class, unless the deductible were closely linked to income.
One does not need a Ph.D. in economics to realize that a low income family confronted with a high deductible will tighten its belt in health care much more than would a high income family confronting the same deductible.
Similarly, under our progressive income-tax structure, the idea of tax-preferred Health Savings Accounts (HSAs) ipso facto makes health care for high income people cheaper than for low income people – an amazing ethical proposition.
IV. U.S. HEALTH CARE CA. 2030
At this time, the gradual transformation of our health-care system into one that allows us to ration health care by income is not yet complete.
Part of the problem is that it is not yet politically correct for politicians or the policy wonks who advise them openly to state that rationing by income class is their goal.
The desired structure therefore has to be developed quietly, and so that the general voting public does not know what is happening to their health system.
Indeed, sometimes the steps toward this goal are marketed to the voting public in classic Orwellian lingo – e.g., “Consumer Directed Health Care” (CDHC) that will “enable consumers [formerly patients] to sit in the driver’s seat in health care to shop around for cost-effective care.”
Absent solid, consumer-friendly information on binding prices and the quality of health care produced by different providers of health care – still typically the norm in the U.S. – CDHC actually has turned out to be a cruel hoax.
For the most part, CDHC has been merely an instrument to ration health care by income.
We came across the following paper that goes along with our thesis on rationing: “Wealthy spending more on health care than poor and middle class, reversing trend”
V. CONCLUDING REMARKS
It is not our place to render a value judgment on the merits of this development. That is a matter of ideology and of ideas of what is a “just society.”
But register our amazement — almost our admiration — at the ease with which one faction of the nation’s elite has been able to further this transition – a development of which the voting public hardly seems aware (except when illness strikes).
It can be doubted that the general populace of other countries – France, Germany, the U.K., Canada – would accept this transition with such astounding equanimity.
It is only of recent that the American public seems to have lost faith in the wisdom and beneficence of the nation’s policy-making elite.
We shall see how far that elite can push rationing health care by income before the American public becomes fully alert to that policy.
In an honest referendum, with full knowledge of what is underfoot, the general voting public probably would not support a move to rationing more and more health care by income.
More likely the voting public would opt for a more egalitarian system, which can explain why it is not yet politically correct for politicians openly to advocate rationing health care by income.
“Americans Overwhelmingly Prefer This Presidential Candidate’s Healthcare Plan, Study Shows”
According to Gallup… the overwhelming favorite was the single-payer plan offered by Bernie Sanders. Overall, 58% of respondents favored the idea, with just 37% opposing it and another 5% having no opinion.
In a separate question, Gallup asked respondents to choose between putting a single-payer system in place versus keeping Obamacare in place,and single-payer won by an even broader margin — 64% to 32%.
===
Comment by Don McCanne
Everyone should master understanding the concept presented here. Should the distributive ethic in health care represent a social good for all or an individual responsibility for each of us?
We are transitioning further into the individual responsibility ethic through the platforms of tiering insurance by income (narrow networks and limited benefits) and tiering health care by income at the point of service (high deductibles, health savings accounts, and consumer-directed health care). Thus we are rationing health care by ability to pay, and that will only increase further as we expand our current health care policies. Too many people will not be receiving the care that they should have.
This slide set was expanded to include some of the narrative so that we can understand better how our current approach to sustainability is political rather than economic - supporting an ethic that preserves the wealth of the wealthy by suppressing redistribution, while making the health care system sustainable by making health care less affordable for the majority.
This presentation by the insightful team of Uwe Reinhardt and Tsung-Mei Cheng should be downloaded and shared with as many other concerned individuals as possible. We need to deliver the egalitarian message that the people of other nations take for granted: we can have health care for everyone in a system that is truly sustainable.
Nurses and Doctors Are Fighting Back Against Corporate Healthcare by Unionizing
Overwork, once a proud hallmark of the medical profession, now symptomizes systemic rot.
By Michelle Chen
Health-care issues got scant attention at the Democratic National Convention in Philadelphia, but outside the hall, a wave of labor victories at area hospitals showed the business of medicine is getting an injection of union action; medical workers who are sick of seeing their care devalued are building resistance to an epidemic of corporatization.
Nurses at Hahnemann Hospital, part of the for-profit hospital chain Tenet, voted in January to unionize with the Pennsylvania Association of Staff Nurses & Allied Professionals (PASNAP) by an 82-percent majority in a National Labor Relations Board election, winning representation for roughly 850 nurses. Another unionization followed for hundreds more nurses at another Tenet facility, St. Christopher’s Hospital for Children.
Around the same time, about 330 nurses and dozens more support staff at Delaware County Memorial Hospital in Drexel Hill held two successful union votes. The victories established collective bargaining units just ahead of a takeover of the hospital’s parent organization by another for-profit chain, Prospect Medical Holdings.
In April, nurses at Philadelphia’s Einstein Medical Center voted to unionizefollowing a hard-fought organizing drive, during which nurses decried dismal and unsafe working conditions. Organizers also clashed with the management’s anti-union campaign in which nurses were reportedly dragged into “captive audience” meetings with anti-labor consultants acting as propagandists to discourage them from organizing.
According to PASNAP’s surveys of recently organized nurses, about seven in ten respondents “reported never having adequate staffing”; just four in 100 reported that “they always had safe staffing.” About 70 percent reported not having adequate break times, which are linked to continual understaffing and overwork.
Speaking after an intense shift that left him exhausted, Einstein nurse Kevin Chilton recalled having to leave the next shift with an even heavier burden, since it was even more short-staffed than his had been.
“I just left work on a very strenuous, tough assignment, and passed on an even worse assignment to my peers,” he lamented. He might have stayed longer if he could, “but I was so depleted that that wasn’t a viable option. But I felt so bad, for the nurses that were coming on.”
Adding to the stress is the management’s cost-cutting tactic of slashing technical-support staff, which leaves nurses with even more intense work burdens.
PASNAP President Patty Eakin, who worked as a nurse at nearby Temple University Hospital, says, “It’s a terrible, terrible feeling, to go home at the end of the day feeling so ragged and exhausted. And then worried, so worried: Did I do this? Did I chart that?… They’re collapsing under the load that the boss is putting on them.”
Getting safe-staffing ratios codified into all union contracts is a top priority for PASNAP, but it’s not enough to go contract by contract, warns Eakin, when many facilities remain non-unionized and management keeps trying to squeeze staff to pump up profits. So PASNAP is pushing for state legislation to mandate staffing ratios at Pennsylvania hospital facilities. The proposed bill, which follows landmark safe-staffing legislation already enacted in California, would guarantee staff levels like a one-to-one ratio in trauma emergency care, as well as special protections for staff’s right to negotiate workloads and work assignments.
Closing chronic staffing gaps keeps workplaces and patients healthier. A recent comparative study on the impact of staffing mandates projected that when staffing ratios for nurses in New Jersey and Pennsylvania matched California’s mandated safe-staffing levels, “nurses’ burnout and job dissatisfaction were lower, and nurses reported consistently better quality of care.”
Nurses aren’t the only ones stretched to the breaking point in hospitals and clinics. Even doctors are increasingly reminded everyday that they’re workers like everyone else. A national study on doctors’ work experiences has revealed massive work-related stress, with 46 percent reporting severe stress, up from 38 percent in 2011. One major factor cited was new regulatory pressures under the Affordable Care Act.
A few overworked doctors just got a union of their own in Minnesota. An 11-member medical-professionals unit of Steelworkers Local 9460, which includes three doctors along with nurses and other staff, recently finalized it first contract at Lake Superior Community Health Center, a facility serving low-income communities in Duluth, Minnesota. The hard-fought contract came after years of internal struggle. Staff complained of a climate of anti-union hostility and intimidation—tensions that culminated in a contentious organizing drive and 42 unfair-labor-practice charges against the management filed with the NLRB.
While this is the first unit in the 2,300-member amalgamated local that includes doctors, staff representative Cathy Drummond said the staff approached the union with the same workplace issues that other health-care workers routinely experience: “When the employer had made significant changes to their working conditions and hours…they felt that they needed a union so that they could come in and have a voice and to make sure that changes like this weren’t going to happen without them having a voice in those changes. And [with] a contract, those changes can’t occur without bargaining over them.”
For all medical workers, overwork, once a proud hallmark of the profession, now symptomizes systemic rot. To tackle the root cause, nurses unions have become a leading voice in the movement for single-payer health care. Eakin argues that breaking the dominance of the medical insurance industry is critical for overhauling the social-service infrastructure as a whole.
“Part of the problem is, this for-profit system is so set up to…suck dollars out of the system, and give it to health-care corporations, pharmaceuticals, Wall Street executives, instead of using that money to take care of patients.”
As front-line care providers, Eakin says, “We’re in a strong position to advocate for all patients.… But I think a lot of employers are trying to undermine that, because they don’t want nurses to be speaking out about inequality and about improving access for everybody.”
Addressing inequality in all levels of the health-care structure, as a workforce and public trust, means that patients aren’t safe unless their rights at work are secure. “One of the biggest things we’re going to get out of [a union],” she says, “is a legal voice, and a way to raise our voices up together and say, ‘This has to change.’”
https://www.thenation.com/article/nurses-and-doctors-are-fighting-back-against-corporate-healthcare-by-unionizing/
More junior doctors' strikes on the horizon as union forms plans for 'escalated industrial action'
By Sophie Jamieson and Laura Donnelley - The Telegraph
Junior doctors could stage a series of strikes in September, it has emerged, as the dispute over a new contract continues.
In an email to members, Ellen McCourt chair of the British Medical Association (BMA) junior doctors committee said the comittee's executive members had voted "to reject the proposed new contract in full and to call for formal re-negotiations".
he added: "In response to the Government's silence, JDC Exec has today made a formal request for a special meeting of BMA Council to authorise a rolling programme of escalated industrial action beginning in early September."
The announcement raises the prospect of an all-out strike next month.
The last walkout in April saw junior doctors in accident and emergency, maternity and paediatric departments strike for the first time in the history of the NHS.
Health Secretary Jeremy Hunt announced last month that the new contract would be imposed on junior doctors from October, after they rejected the deal negotiated by the BMA and the Government.
Dr McCourt said in her email that forcing a contract on junior doctors "in which they don't have confidence, that they don't feel is good for patients or themselves, is not something they can accept".
Daniel Mortimer, the Chief Executive of NHS Employers, said: "Industrial action achieves little or nothing, but places pressure on already stretched teams and services and causes worry, distress and disruption for patients, carers and their families."
He added that there had been discussions over the past two months to address junior doctors' concerns about issues like whistleblowing.
"Employers were hopeful that the continued positive engagement on other important topics - such as deployment, flexibility in training, additional training for those returning from career breaks, costs of training, mutual recognition of syllabus, study leave and the gender pay gap in medicine - were a sign of how serious employers, Health Education England and the Department of Health were about honouring the agreements reached with the BMA in November, February and May."
Driven to Suicide by an ‘Inhuman and Unnatural’ Pressure to Sell
by Geeta Anand and Frederik Joelving
INDORE, India — Leaving his wife and two young children home on a recent Sunday, a 27-year-old salesman for Abbott Laboratories’ operations in India — in fact, one of the American health care company’s top performers there — rode his motorcycle to a remote railroad track and jumped in front of a train.
In his pocket, a note in blue ink, handwritten in a mix of Hindi and English, said, “I’m going to commit suicide because I can’t meet my company’s sales targets and my company is pressuring me.”
Ashish Awasthi’s death last month resonated across India and through the halls of the health care giant. More than 250 fellow Abbott drug representatives in India walked off the job for a day, protesting what some called the company’s overly aggressive sales policies. A national union of drug sales workers called for new government rules to rein in sales practices industrywide, saying they compromised patient health.
A six-month investigation by The New York Times found that in the push to win customers in India’s chaotic and highly competitive drug market, some Abbott managers instructed employees to pursue sales at virtually any cost — in violation of Indian law, professional medical standards and the company’s own ethics guidelines.
Sales jobs with global powerhouses like Abbott are highly prized positions in India. But they can also be extremely demanding, putting employees under inordinate pressure to cut corners, according to interviews with more than a dozen current and former sales representatives and managers and a review of internal Abbott communications provided by two of them.
In one of the most common practices, The Times found, Abbott managers told sales staff to hold what the company called health camps, where representatives would perform tests on patients for various ailments in an effort to drum up business for doctors, who would then prescribe Abbott drugs. The camps were typically held at doctor’s offices or as community events.
Sales personnel who perform screening tests could be accused of practicing medicine without a license, a criminal offense, said Dr. Jayshree Mehta, president of the Medical Council of India, the country’s medical regulatory agency. Indian medical ethics regulations also prohibit quid pro quo, Dr. Mehta said.
Abbott India’s public affairs director, Anand Kadkol, said the company’s marketing policies “are aligned with applicable laws” in India. He called the health camps “disease awareness education programs” and said that Abbott’s policies did not allow the camps to be conducted “in exchange for an explicit or implicit understanding” to prescribe Abbott products.
The company declined to comment on individual employees. Mr. Kadkol said Abbott was “aware of a number of the allegations raised” and had addressed them.
But Vivek Gupta, a former manager of a sales team in northern India, said he was fired last year under pressure to make his sales representatives do more screenings of patients to promote a new Abbott multivitamin for nerve damage. He tried to resist, he said, out of respect for the national rules and the company’s own policies, which prohibit the use of health camps to influence which medicines are prescribed.
by Matt Jablow
TOWSON, Md. — Two days into a long-dreamed-of family vacation to Italy in August 2013, my wife, Ronna, became nauseated, unusually tired and short of breath. One of the great non-complainers in American history, she insisted that it was no big deal and valiantly tried to join in on various outings in the Italian countryside. But, after a few increasingly difficult days, even Ronna knew that it was time to go to the emergency room.
In a small hospital in Tuscany, doctors identified the apparent source of the problem: a pericardial effusion, or a buildup of fluid around the heart. Ronna was transferred to a larger medical center in Arezzo, where a pericardial tap was performed. Immediately afterward, in a scene that still plays on a loop in my mind’s eye, the hospital’s chief of cardiology informed me that, while the fluid was gone, he was quite sure that Ronna had lung cancer.
A few weeks later, when we were back home in Maryland, doctors at Johns Hopkins Hospital confirmed his suspicion: My healthy, active, 48-year-old, never-smoker wife had Stage 4 non-small cell lung cancer.
Over the next two years, Ronna underwent several rounds of grueling chemotherapyand, when the cancer spread to her brain, several rounds of radiation treatment. She also took part in a clinical trial at Johns Hopkins for Opdivo, an immunotherapy drug made by the pharmaceutical company Bristol-Myers Squibb. Briefly stated, immunotherapy is a recently developed, highly promising treatment that helps a person’s immune system identify and attack cancer cells. But it did not work for Ronna, and last Sept. 25 she died as her parents and I held her hands and whispered in her ear.
Needless to say, it has been a difficult year for my two children and me. But, knowing that Ronna couldn’t abide self-pity, we have been slowly moving forward by doing our best to cope and trying to honor, whenever possible, her remarkable memory and legacy.
A few weeks ago, though, I saw a television commercial that dealt that process a setback. It was a 90-second ad for Opdivo that began with soaring music and shots of older people in warm sunlight, gazing upward at a building on which the words “A chance to live longer” were superimposed. The voice-over said, “Opdivo significantly increased the chance of living longer versus chemotherapy.” The wording may be a little clumsy, but the velvet-voiced narrator made his point, bolstered by actors portraying lung cancer patients playing with babies and watching Little League games.
It would be incredibly uplifting if it weren’t so utterly misleading and exploitive. To date, only about one in five patients with Stage 4 non-small cell lung cancer has seen any measurable response to Opdivo; and, in those patients who do respond, the median increase in life expectancy is only about three months compared with standard chemotherapy.
The overall five-year survival rate for people with Stage 4 lung cancer is between 1 and 5 percent. Instead of a “chance of living longer,” a more truthful narrator would have said, “Opdivo provides an outside chance for people with advanced lung cancer to live just a few months longer.”
Last Friday, Bristol-Myers Squibb announced that Opdivo didn’t pass its most crucial test to date: During a clinical trial, the drug failed to slow the progress of advanced lung cancer (compared with chemotherapy) when used as the front-line drug. Opdivo is still approved to treat lung cancer after a patient has gone through chemotherapy — but, dashing huge expectations and the highest of hopes, the drug didn’t work as a first treatment for patients.
Immunotherapy is an exciting development with the potential to significantly extend the lives of thousands, perhaps millions, of patients. But right now, the hype far exceeds the reality. The drugs are expensive and their efficacy, as shown by the Opdivo trial, is far from guaranteed.
Given the uncertainty, it is shameful for Bristol-Myers Squibb to prey upon the fears and waning hopes of terminal cancer patients, and irresponsible of the Food and Drug Administration to let it. The United States and New Zealand are the only two countries in the world that permit direct-to-consumer pharmaceutical ads. Whether or not they should be banned, as the American Medical Association has argued, a good first step would be to insist that advertisements promoting drugs for life-threatening conditions be entirely forthright about outcomes.
The Opdivo commercial closes with the narrator thanking “the patients and physicians who participated in the Opdivo clinical trial.” Patients like my incredible wife. If you really want to thank them, pull those ads off the air.
Maine has sliced the ranks of nurses who prevent outbreaks, help drug-affected babies
by Matthew Stone - BDN Staff
When a novel strain of influenza swept across the U.S. in 2009 and made its way to Maine, infecting thousands and causing outbreaks at 40 summer camps and 200 schools, 50 nurses employed by the state got to work.
Maine’s public health nurses helped to set up and staff 238 vaccination clinics across the state. They helped school nurses vaccinate students, and ensured vaccines were effectively distributed and safely stored. They educated others charged with vaccinating at-risk populations. With public health nurses’ help, Maine managed to vaccinate children and seniors — the populations deemed at greatest risk — at some of the highest rates in the nation.
“We were people with boots on the ground,” said Janet Morrissette, who served as the state’s public health nursing director at the time.
Since then, the number of public health nurses has been cut in half.
The remaining 25 nurses working in the field face a long list of public health duties: visiting expectant and new mothers in their homes, especially mothers with drug-affected babies; training local health-care providers on tuberculosis detection and vaccine storage; carrying out immunization clinics as needed; monitoring treatment for those infected with tuberculosis or latent TB; and contributing to emergency preparedness in Maine’s nine public health districts. Two other nurses work in administrative roles, handling referrals to nurses working in the field.
“I’m really worried, should something like [the H1N1 outbreak] happen now, where’s the public health workforce that’s going to be able to mount that response?” said Morrissette, who served as public health nursing program director from 2005 to 2011.
Maine’s public health nurses have been around since the 1920s, when their primary mission was to improve prenatal health among expectant mothers and prevent infant deaths. They were some of the first employees of the state’s Division of Public Health, which evolved into today’s Center for Disease Control and Prevention. Unlike most classes of state employees, their responsibilities are defined in state law.
But the number of public health nurses has steadily declined over the course of Gov. Paul LePage’s administration, even as legislators have provided funding for the positions in the state budget. The state has filled few of the more than 20 vacancies that have come up in recent years, leaving key population centers and rural areas with scant coverage.
Plus, at a time when Maine’s infant mortality rate has risen to 13th highest in the nation and more babies are born exposed to substances, the Maine CDC has shifted many of the nurses’ duties away from promoting maternal and child health and promoting the public’s health in general.
Documents obtained by the BDN, interviews with former employees, and CDC staffing charts from various points in time over the past 12 years paint a picture of a key public health program whose operations the LePage administration has largely hobbled.
State health officials have claimed internally and, on occasion, publicly to be reallocating “limited” resources to the people and areas who need them, “structuring the duties of public health nurses to ensure work is at the highest and best use of nursing scope of practice” and “aligning resources to meet priorities.”
But the disappearance of much of the state’s workforce charged with controlling the transmission of communicable diseases, promoting maternal and child health, and carrying out school health screenings has largely happened without publicity from the state, much less a broader explanation of the LePage administration’s ultimate plans for the program.
“I think this was looking at health care as a business, and it wasn’t profitable to have all these nurses,” said Ted Hensley, who served as public health nursing director from September 2012 until he resigned in March. “I think it was all money-saving. It was all about money, not providing health care.”
A Maine CDC spokesman didn’t respond to repeated requests for comment from the BDN.
Front lines
Across the country, public health nurses typically form the largest segment of the professional public health workforce — whether they’re employed by state or county governments — according to the Association of Public Health Nurses.
Unlike nurses who care for individual patients, public health nurses focus on the health of populations. Traditionally, they pay particularly close attention to the health of newborns and their mothers. In Maine, about 30 percent of state public health nursing positions are funded by the federal Maternal and Child Health Block Grant.
Public health nurses visit expectant and new mothers at home — free of charge and regardless of income level — to help new parents settle into parenthood. They screen mothers for postpartum depression. They monitor and address potential health problems with a newborn, often connecting parents and infants with services in their community.
As certified lactation consultants, they help new mothers become accustomed with breastfeeding and address related medical problems such as thrush, a fungal infection that can develop in babies’ mouths, or the breast tissue infection mastitis. Nurses assess the home environment to help parents address safety issues. A public health nurse is also on the lookout for signs of abuse, neglect and family violence.
“You never knew” what to expect, said a public health nurse who left her job recently and spoke on the condition of anonymity. “If you went to a house where it was winter and there was no heat, or someone felt threatened, or there were active problems going on, people weren’t safe, that would take priority. That was our goal, that moms and the babies would feel safe.”
When refugees arrive in Maine, Catholic Charities — the state’s designated resettlement agency — refers the new arrivals to public health nurses in the Lewiston and Portland areas, who then examine the refugees’ health records and connect them with health care providers.
And when a patient has either active or latent tuberculosis, health care providers alert a local public health nurse, who then visits the patient at home to ensure he or she is taking the required medications, handling side effects and not showing signs of liver injury — a risk with anti-TB medications. With an active tuberculosis case, a public health nurse can also be responsible for a contact investigation: getting in touch with the people with whom the patient has had contact and testing them for TB, which is easily spread.
For a patient with latent tuberculosis, which has a 5 to 10 percent chance of developing into full-fledged TB, public health nurses visit monthly for nine months, said Ronnie Paradis, who worked 10 years as a public health nurse in Lewiston until retiring in June 2015.
There were 18 confirmed TB cases in Maine last year, including two that were drug-resistant, according to the CDC, and eight contact investigations that involved 241 contacts.
“As far as TB was concerned, if they had active TB, we would go daily and watch them swallow the pills, except for weekends and holidays,” Paradis said. “We had to watch them. With the TB meds, they were usually on at least four meds. There were a lot of side effects. We would communicate with the doctors all the time.”
When northern Maine saw a cluster of botulism cases in 2002, public health nurses connected with those who were infected and those at greatest risk of infection, helped them go through their food — as the poison is commonly spread through canned food — and collected samples for testing.
“They were the go-to people in the field on the ground,” said Jennifer Gunderman-King, who worked at the time as a Maine CDC infectious disease epidemiologist.
Whether it’s hepatitis, E. coli, salmonella, pertussis or Ebola, “when these things are reported and found, your public health nurses are the ones there who are making sure there’s adequate follow-up and containment of that kind of outbreak,” said Hensley.
That’s more difficult now with fewer nurses.
“We’re not living in as safe of a public health environment as we were several years ago,” Hensley said.
Erosion of the ranks
Annual reports dating back to 2004 show Maine’s public health nursing program consistently had 48 to 50 nurses in the field, four to five direct supervisors, four consultants involved with managing different aspects of the program, and one director. In 2004, the nurses were based out of 16 offices around the state. Most offices had staffers providing clerical support.
Maine CDC organizational charts obtained by the BDN show a program steadily shrinking over the past year-and-a-half. They also reflect the effects of the state budget that passed in June 2015, which eliminated seven nurse positions, two supervisor posts and one program consultant position — all vacant — as part of a larger elimination of vacant CDC positions.
An April 2016 organizational chart shows a scaled-back program with 43 nurse positions, but only 32 of them filled. Two of those nurses handled patient referrals and didn’t perform field work.
In the three months after that staffing chart came out, the BDN has found, five nurses departed, leaving a staff of 25 in the field (24.7 full-time equivalent positions), two nurses handling referrals, two supervisors, two management consultants and two office associates.
“This administration has been systematically decreasing our staffing and not filling positions when they become open,” Hensley wrote in an email. “Our ability to provide services has been compromised to have adequate boots on the ground and staff, to safely provide public health services.”
As director, Hensley said, he asked repeatedly for clearance to fill vacant posts.
“Basically, I was just told, ‘no,’ and I would request every week or every other week for those positions to be filled,” he said.
Demand without supply
The state’s public health nurses traditionally have filled in the health-care system’s gaps, providing maternal and child health services in rural areas where other services aren’t available and serving refugees in the Lewiston and Portland areas.
In the Bangor area, one full-time public health nurse and one part-time nurse cover a territory that includes Penobscot and Piscataquis counties and now, increasingly, Kennebec County. Before the current state budget took effect, the Bangor public health nursing office had six full-time nursing positions and one part-time position. (The city of Bangor separately employs two nurses who visit new and expectant mothers within city limits.)
Today, in the Lewiston area, three public health nurses cover a territory that stretches from Lewiston-Auburn through much of western Maine. Within the city of Lewiston, the nurses’ work largely involves TB treatment monitoring. In rural western Maine, nurses visit expectant and new mothers. The program’s Lewiston office previously had eight positions.
“We have people who can’t start their treatment for TB on time and can’t be monitored the way they need to be because there are no public health nurses available,” said Carolyn McNamara, a nurse practitioner at B Street Health Center in Lewiston, which is affiliated with St. Mary’s Health System.
“When it comes to active TB, they have to have all hands on deck, making sure that person takes their medication and is not in a position to transmit TB. That’s when it’s really emergent,” said McNamara, who estimates she has referred 600 patients to public health nurses over the past decade. “The potential that we could see a delay with that is very concerning.”
With Lewiston coverage limited, nurses based in the Augusta area are often called to Lewiston, said Rep. Gay Grant, a Gardiner Democrat who has advocated for the public health nursing program and who is in contact with nurses employed in the program.
“Right now, we have a 39 percent vacancy rate of trained public health nurses, and they’re stretched so thin they can barely keep up with their workload,” she said. “That’s without an emergency.”
The Portland area’s coverage is down to five public health nurses where it used to have eight. Another nurse is located in Sanford; Sanford used to have two.
Two nurses cover all of Washington County. Four cover Aroostook.
Public health nurses currently employed by the state declined to speak with the BDN, citing fear of retaliation, job loss or further damage to the program if they spoke out.
“Everyone is in fear — the climate and culture in Maine CDC,” Hensley said. “There was nothing but a culture of terror. Everyone was dancing to the tune of the commissioner’s office and afraid for their jobs.”
“Everything was secrecy, not transparency” as nurses watched the program shrink around them, Paradis said. “We didn’t know if we were going to be fired or let go or what. Everything was a secret. Nobody would tell us what they were doing.”
Target for cuts
The contraction of Maine’s public health nursing program has happened as a result of attrition rather than any mass layoff. But the LePage administration repeatedly has targeted the program for cuts.
In 2013, the governor’s Office of Policy and Management recommended cutting $500,000 from the program’s more than $3 million state-funded budget. Democratic lawmakers rejected those cuts and made up for a budget shortfall through other means in early 2014, said Rep. Peggy Rotundo, a Lewiston Democrat and House chair of the Legislature’s Appropriations Committee.
But even with the positions preserved in the budget, the LePage administration continued to leave vacant positions unfilled.
As 2014 drew to a close and flu season approached, Appropriations Committee members inquired about public health vacancies in writing on Nov. 13. “What is the Department’s plan to fill key vacancies at the CDC?” committee members asked of the Maine Department of Health and Human Services.
Health and Human Services Commissioner Mary Mayhew didn’t respond until Feb. 3, 2015. “The Department actively continues to seek qualified individuals for key public health vacancies,” she wrote. “While vacancies are being addressed, the CDC maintains a highly qualified staff of credentialed professionals who monitor infectious diseases and attend to other public health matters.”
When LePage presented his two-year budget proposal that winter, his administration proposed the elimination of seven vacant nurse positions, two supervisor positions and one program consultant.
“In our negotiations with Appropriations, we held onto them, we held onto them, we held onto them,” said Rotundo. “Then at the end of the budget process, when it became clear he would not fill those positions, we decided we would take the money” and put it elsewhere in the budget.
Even with seven vacant nursing positions eliminated, five nursing vacancies remained — and the number of vacancies has only grown since the budget passed more than a year ago.
“We’re supposed to believe that when we develop a budget or pass a law — a law, mind you — that that would be carried out,” said Grant, the Gardiner Democrat, who also serves on the Appropriations Committee. “That is not what we’re seeing, and we can’t do anything about it.”
Hiring plans
The LePage administration has indicated on other occasions since that February 2015 communication to the Appropriations Committee that it planned to fill nursing vacancies, but it has rarely followed through.
On May 5, 2015, public health nursing managers were called to a meeting with CDC leadership and Sheryl Peavey, then the strategic reform coordinator in Mayhew’s office and now the CDC’s chief operating officer. They were given a memo that identified priorities for restructuring the program — a memo developed without input from nurses or their managers, according to Hensley, and after Maine DHHS leadership had already asked Hensley and his management team to devise restructuring strategies and paid “very little attention” to their suggestions.
“The data clearly shows that certain areas of the state have specific needs that require more staff resources,” the memo reads. “For example, nearly 20 percent of all babies born affected by substance were born in Bangor. But we did not adjust our service priorities to be sure those infants thrived.”
The memo also listed “filling vacancies to ensure appropriate staff levels” as a step for the program “moving forward.”
But neither change highlighted in the memo has happened. The Bangor area at the time had the equivalent of 5.7 full-time nursing positions. Today, the Bangor region has one full-time nurse and one part-time nurse doing field work. Nurses in that office have had coverage areas that stretch from Waterville to Lincoln.
Maine had 36.2 full-time equivalent public health nurses at the time of the May 2015 memo. Today, the program is down to 26.7 full-time equivalent nurses, including two who don’t work in the field.
The LePage administration did relent and hire last year when faced with public pressure from a Republican lawmaker.
On April 15, 2015, the Legislature’s Health and Human Services Committee held a public hearing on LD 1077, An Act to Ensure Access to Public Health Nursing Care and Child and Maternal Health Nursing Care in Washington County. The bill, sponsored by Sen. David Burns, R-Whiting, proposed to reallocate funds to provide for additional public health nursing capacity Down East.
“I have been told by the experts that we in Washington County have a very serious problem, in fact a crisis, in two specific areas,” Burns said in his testimony.“Washington County has only one public health nurse, and the county has been without any child and maternal nurses for the past four years.”
Indeed, the public health nursing program’s Calais office had long had two vacancies. The county’s only public health nurse was based in Machias in a rural county that covers 3,300 square miles.
“And having just come through one of the worst winters in decades, with the City of Eastport receiving over 14 feet of snow, can you imagine what travel has been like for our one public health care nurse?” Burns continued.
The Maine CDC’s then-director, Ken Albert, delivered testimony opposing the bill, but said, “We can commit to more aggressively assuring that our vacancies are filled in the Washington County area.”
The state budget that passed two months later eliminated one of the Calais office’s two positions, both vacant. But the CDC later filled the remaining Calais post, a CDC organizational chart from late 2015 shows.
Shift in focus
Research has consistently found that sending a nurse into a new parent’s home is an effective intervention. Coaching from a nurse can reduce the likelihood of pregnancy complications, pre-term births, infant deaths, child abuse and other negative forces in a child’s life.
Research also has connected nurse coaching to improved language development among young children and improved cognitive and educational outcomes.
In South Carolina, Republican Gov. Nikki Haley earlier this year announced a $30 million expansion of nursing services for first-time mothers in rural areas with historically high infant death rates.
For much of its history, Maine’s public health nursing program was available to any mother and newborn, regardless of income and regardless of whether the family had special health needs.
But over time, public health nurses began to visit primarily those mothers with children at greater medical risk — premature and low-birthweight babies, babies with disabilities and developmental delays, and drug-affected babies, including babies born to mothers taking methadone to treat an addiction.
Even more recently, nurses have shifted to seeing more adult patients, particularly frequent users of Medicaid services.
In 2004, public health nurses spent more than 45 percent of their time on maternal and child health. Under the reorganization presented to public health nursing staff in May 2015, nurses were to spend just 26.4 percent of their time on maternal and child health — chiefly focusing on drug-affected babies and children with disabilities and developmental delays. Nurses would spend 48 percent of their time on infectious disease, 11 percent on medically complex Medicaid cases, and 6.6 percent on elderly residents who are known to Adult Protective Services.
They were to spend 4 percent of their time on health promotion — essentially, the work of helping communities improve public health.
“We were getting more into adults and less into maternal and child health because that was more Maine Families territory,” said the nurse who spoke on condition of anonymity.
While public health nursing has been available for almost a century, the home visiting program Maine Families has evolved over the past 20 years into a statewide program that employs certified parent educators throughout the state to visit new parents at home. They can perform parent education, but they lack the training a nurse has to detect or address medical needs.
‘Compromised and decimated’
The loss of nurses isn’t the only factor to interfere with public health nursing operations. A number of program policies complicated program operations.
— For most of his tenure as director, Hensley was barred from communicating with his staff via email without approval from Chase Martin and Peavey in the DHHS commissioner’s office. “They would approve on one hand and on the other hand, would disapprove,” Hensley said. “It essentially interfered with my ability to do business and work with the program.”
— After the May 2015 restructuring meeting, the public health nursing program closed many of its regional offices — which were located in regional DHHS offices — and started dispatching nurses from home. Maine CDC also dropped most public health nursing administrative support staff, leaving more paperwork for nurses to complete, mostly in their cars since they no longer had desks, according to Hensley and former nurses.
“Public health nursing has always been an independent and an individual job,” said the former nurse who spoke anonymously. “That made it even more so: not having a supervisor as a sounding board, more paperwork, more expectations, more responsibilities and more challenging responsibilities, and fewer staff.”
— A blanket ban on texting among DHHS employees meant that public health nurses couldn’t communicate with clients using the medium that many of them used exclusively. “We lobbied for getting it back,” Hensley said, but nurses still didn’t have the ability when he resigned.
— For a program trying to get the word out to potential clients — namely, new mothers — DHHS leadership ordered public health nursing to remove its program brochures from circulation, Hensley said. And due to reduced staffing, public health nursing could no longer afford for nurses to spend time as ambassadors for the program, explaining their services to local health care providers and how and when to make referrals.
— In another sign of its contraction, the public health nursing program’s accreditation with the Community Health Accreditation Partner lapsed in 2015. The program first earned it in 2009 under Morrissette and renewed it in 2012. It was the only statewide public health nursing program to attain CHAP accreditation.
“Not all organizations achieve accreditation the first time around,” Morrissette said. “We did, with a commendation as well.” In 2012, Maine public health nursing renewed its accreditation “without a single ding,” Hensley said.
But in 2015, Hensley said, the program likely wouldn’t have met the required standards due to a diminished staff of public health nurses and few supervisors.
With the number of public health nurses continually on the decline, “the fact that they are an incredibly important resource for this state is not only not being recognized,” he said, “but is being completely compromised and decimated.”
Hikes In Employees' Health Premiums To Outpace Raises Again
by Jay Hancock - NPR
Large employers expect health costs to continue rising by about 6 percent in 2017, a moderate increase compared with historical trends that nevertheless far outpaces growth in the economy, two new surveys show.
"These cost increases, while stable, are both unsustainable and unacceptable," said Brian Marcotte, CEO of the National Business Group on Health, a coalition of very large employers that got responses from 133 companies.
Employers are changing tactics to address the cost trend, slowing the shift to worker cost sharing and instead offering video or telephone links to doctors, scrutinizing costs of specialty drugs and steering patients to hospitals with records of lower costs and better results.
Most employees at large companies should expect a 5 percent increase in their premiums next year and, in contrast to previous years, "minimal changes" to plan designs, NBGH said.
The portion of employers offering high-deductible health plans next year — 84 percent — is essentially unchanged from 2016, according to the NBGH report. So is the percentage of companies offering high-deductible plans — 35 percent — as the only choice for workers and families.
Patients with high-deductible coverage pay thousands of dollars in medical costs before the insurance kicks in.
The idea is that sharing the pain makes employees smarter shoppers, prompting them to forgo unneeded tests and find the best price. But critics say available tools to shop for care are grossly inadequate.
Counting cost-control measures, companies responding to NBGH's survey expect their net health expenses to rise by 5 percent next year. A survey of hundreds of employersby consultants Willis Towers Watson showed similar results.
"This is well above the cost-of-living increase," said Julie Stone, health care practice leader at Willis Towers Watson. To control costs, "our clients are willing to do things that a few years ago employers might have been reluctant to do," she said.
For what it's worth, 5 percent or 6 percent is moderate compared with medical-cost growth in the early 2000s, when annual percentage increases reached double digits.
But it's still far greater than recent increases in corporate profits and economic output. And it's greater than the 3 percent increases in workers' pay that many groups expect for 2017.
Economists partly blame the skimpy raises workers have received over the past decade on the ballooning resources employers had to devote to health spending.
Moderate cost trends in the large-employer market seemingly contrast with those in the Affordable Care Act's online marketplaces, where plans sold to individuals are seeking premium increases of 10 percent or more.
But the variation has more to do with volatility in how insurance companies price their plans than with big differences in underlying costs, said Larry Levitt, a senior vice president with the Kaiser Family Foundation. (Kaiser Health News is an editorially independent program of the foundation.)
Many marketplace plans underestimated costs for their members this year, forcing catch-up increases for 2017, he said.
New kinds of spending are driving health cost increases.
Even as hospital use has moderated, employers point to specialty drugs to fight cancer or hepatitis C that can cost tens or hundreds of thousands of dollars per patient as a new major contributor to health expense.
Nearly 1 in 3 companies said specialty drugs are the main factor in cost increases, according to the NBGH survey. Nine of 10 employers plan to install programs to manage specialty-drug costs, according to the Willis Towers Watson study.
Approaches include shifting drug coverage to large pharmacy benefit firms, which can deploy better buying power against the manufacturers, and infusing drugs at patients' homes rather than in expensive hospitals, Stone said.
Employers are increasingly steering workers toward hospitals with records of higher quality results and fewer complications for expensive procedures such as fertility treatments and bariatric surgery. Until now companies have promoted such "centers of excellence" mainly for organ transplants.
They're also encouraging remotely delivered preventive care by offering nurse coaches for the chronically ill via telephone and video conferencing to extend the hours of primary care clinicians.
Nine out of 10 large employers will offer such telehealth services next year in states that allow it, up from 70 percent this year, the NBGH survey shows.
Employers continue to shrink coverage for workers' spouses, especially if spouses have access to a medical plan through their own workplace.
By 2018 Willis Towers Watson expects nearly half of large companies to charge an extra $100 or so a month to carry a working spouse on the plan — in addition to the regular premium contributions.
http://www.npr.org/sections/health-shots/2016/08/10/489338056/hikes-in-employees-health-premiums-to-outpace-raises-again
The state’s largest insurer of individual health plans is suing the federal government for over $20 million in owed payments.
Maine Nonprofit Joins Growing Ranks of Obamacare Insurers Suing Feds
by Steve Mistler - MPBN
The lawsuit, by Maine Community Health Options, or MCHO, marks the latest development in the ongoing struggle of Obamacare health co-ops, many of which have already shuttered because of financial woes.
It has been a rough year for MCHO. The nonprofit was one of nearly two dozen health care co-ops setup nationwide in 2014 and funded through the Affordable Care Act, or Obamacare, with over $2 billion in federal grants.
The co-ops were constructed as an alternative to commercial insurance. The priority is to write affordable health plans and provide coverage — generating profits is a secondary goal.
But health insurance is risky business. Despite a successful first year in which it posted a net income of $7.3 million, the Maine co-op showed a net loss of $74 million last year. Now the organization, which writes insurance plans for over 75,000 Mainers and once was held up as one of the few co-op success stories, is joining other insurers in suing the federal government for nonpayment of money that was designed to cover big losses in the marketplace.
“It’s what we feel like we need to do, what we have to do on behalf of our members,” says MCHO President Kevin Lewis. “Certainly the capital would be very helpful.”
Lewis says the organization is solvent, cutting costs and working its way out of the deficit. He says the effort would be made easier if the federal government would pay the nearly $23 million it owes MCHO through what’s called the risk corridor program.
The program is modeled after the Medicare Part D. It’s designed to entice typically risk-averse insurers to write plans for people whose health and medical history is unknown. Many of the new recipients were uninsured.
“This new market was bit of an unknown for them,” says Timothy Jost, professor emeritus at the Washington and Lee University School of Law.
Jost says the ACA provided insurers like MCHO with a government-backed safety net.
“It would recover excess profits from insurers who did very well and it would pay out to those who lost money on the program,” he says.
In 2014 MCHO was one of the few insurers that accumulated profits to pay into the program. But by the following year, enrollment through MCHO products soared, and so did utilization of insurance.
Lewis says the company didn’t want to jack up premiums for its members, and it miscalculated just how often the newly insured would use their coverage. That led to the big losses last year, he says.
Those losses are supposed to be protected by the risk corridor program in the ACA.
“It was really meant to kind of provide these guardrails on either side for the first three years of the program,” Lewis says.
But as insurers accumulated losses, the federal government slowed risk corridor payments to a trickle. That’s because Congress restricted the amount of money the U.S. Department of Health and Human Services can pay insurers like MCHO when it passed a spending bill in 2014.
That year, insurers claimed nearly $2.9 billion through the risk corridor program. The feds paid just over $360 million, less than 13 percent of the claims.
Now, all but seven of the 23 co-ops have shuttered. The others like MCHO, as well as big commercial insurers, are suing the feds for the risk corridor money. A class action suit has been filed in the federal appeals court.
Lewis says MCHO is going it alone for now. He wouldn’t rule out a future joint lawsuit.
Jost thinks the insurers like MCHO have a strong case.
“I and many other observers think they have a pretty good claim. The government is supposed to pay its debts and can’t simply decide not do that,” he says.
MCHO filed its claim in the U.S. Court of Federal Claims on Tuesday. Lewis said he wasn’t certain how long it would take to get a ruling.
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