How Prejudice Can Harm Your Health
by Dhruv Khullar - NYT - June 8, 2017
Long before the Rev. Dr. Martin Luther King declared health inequity the most shocking and inhumane form of injustice, W.E.B. Du Bois wrote that “the Negro death rate and sickness are largely matters of condition and not due to racial traits and tendencies.” Before Du Bois made his case, James McCune Smith — the nation’s first black doctor — carefully detailed the health consequences of freedom and oppression.
These men grasped an insight that modern researchers and policy makers often fail to make explicit: Discrimination, especially when chronic, harms the body and the mind. How we treat one another, and how our institutions treat us, affects how long and how well we live.
We tend to think of discrimination as a moral or legal issue, and perhaps, in the case of immigration, an economic one. But it’s also a medical issue with important public health consequences. A growing body of evidence suggests that racial and sexual discrimination is toxic to the cells, organs and minds of those who experience it.
Research suggests that discrimination is internalized over a lifetime, and linked to a variety of poor health markers and outcomes: more inflammation and worse sleep; smaller babies and higher infant death rates; a greater risk of cancer, depression and substance use. The cumulative burden of discrimination is linked to higher rates of hypertension and more severe narrowing of important arteries in the heart and neck. Even the telomeres at the end of our chromosomes, which act as a sort of timer for aging cells, can shorten.
Discrimination, of course, is only part of the health equation. Individuals are not doomed to disease because of their circumstances. Health and illness are the result of a complex interplay between genetics, behavior and environmental conditions. But experiencing persistent bias can tip the scale.
In one study, researchers asked black women to complete questionnaires on how often they experienced minor “everyday” discrimination, as well as major instances of unfair treatment in housing, employment or with the police. They then followed the women for six years, and found that those who had reported more frequent discrimination were more likely to develop breast cancer. The more pervasive the reported discrimination, the higher their risk.
This remained true even after adjusting for more than a dozen other factors like family history, education level, physical activity and use of hormonal supplements or oral contraceptives. Similar work has found that discrimination is a strong predictor of lower back pain in black patients — but not in white patients, who were less likely to report discrimination and for whom discrimination was unrelated to pain.
Those who endure chronic discrimination not only experience more stress, but may also process it differently. To test this theory, researchers used surveys to assess the extent of lifetime discrimination that black and white patients had experienced. They then injected patients with phenylephrine (a chemical similar to adrenaline) and found that black patients had a larger temporary increase in blood pressure than white patients. Those who had experienced more discrimination had the largest rise of all.
There may also be something particularly sinister about racial stress: People have a bigger spike in blood pressure when talking about racial stressors (being accused of shoplifting) compared with nonracial stressors (experiencing delays at the airport).
These effects start early. By fifth grade, black and Hispanic children are already more than twice as likely as white students to say they’ve experienced discrimination at school. (About 7 percent of white children also reported discrimination, and online bullying is a growing problem for students of all backgrounds.)
Children who experience discrimination have higher rates of depression, A.D.H.D.and other behavioral problems. And teenagers who endure more discrimination — racial slurs, physical threats, disrespectful behavior, false accusations — are more likely to have disrupted cortisol levels, elevated blood pressure and higher body mass index years later.
Most important, even for students who experience similar levels of discrimination, there is considerable variability in whether or not they go on to develop health problems. Many negative health effects seem to be mitigated — and in some cases eliminated — for those who have robust emotional support from family and friends. And some research even suggests that low levels of adversity can promote resilience.
Most studies have focused on the health effects of what researchers call interpersonal discrimination, including harassment, “micro-aggressions” or even just the anticipation of prejudice. But an emerging literature is also exploring the role of structural discrimination — the social and economic policies that systematically put certain groups at a disadvantage.
Researchers have tried to calculate structural bias by using racial differences in four domains — political participation, educational achievement, employment and incarceration. Blacks, for example, are 12 times more likely to be imprisoned than whites in Wisconsin, but only twice as likely in Hawaii. In Arkansas, the unemployment rate for blacks is 3.6 times higher than for whites; in Delaware, they’re employed at similar rates.
These unequal social conditions foster unequal health outcomes. Blacks in states high in structural discrimination are more likely to have heart attacks than blacks in low-discrimination states, and black women are more likely to give birth to babies too small for their gestational age. (Data is mixed on whether whites in these states do better or worse.)
In a revealing study of historical data, researchers found that before the abolition of Jim Crow laws, the black infant death rate was nearly 20 percent higher in Jim Crow states versus non-Jim Crow states. This disparity declined sharply after the Civil Rights Act of 1964, such that the gap had essentially closed a decade later. Still, the caustic effects of segregation persist: Blacks in segregated neighborhoods remain at higher risk for hypertension, chronic disease, violence and exposure to environmental pollutants.
Research is also identifying harmful inequities for white Americans along geographic and socioeconomic lines. Whites living in rural areas, compared with those in metropolitan centers, now contend with many of the same structural challenges that worsen health: less education, lower incomes, higher unemployment rates and poorer access to medical care. They increasingly feel that they, too, face significant discrimination. In some counties in the Midwest and South, the death rate for white women in their 40s has doubled since 2000.
Other work has found that gays and bisexuals living in states that institute policies restricting their rights — like same-sex marriage bans or lack of workplace protections — are more likely to develop depression, anxiety and substance use disorders. And a recent study suggests that the Deferred Action for Childhood Arrivals program, or DACA, conferred large mental health benefits to eligible Hispanic adults, who were nearly 50 percent less likely to report symptoms of major depression compared with noneligible people at risk of being deported.
As important as specific policies may be, the general social and political climate probably has broader and longer-lasting effects. Even if they haven’t experienced bias themselves, members of minority groups may develop a hyperawareness for cues of mistreatment, and this sustained vigilance can lead to chronic stress, mood problems and poorer health outcomes. For example, amid a sharp rise in anti-Arab sentiment after the Sept. 11 attacks, women with Arabic names — but not other women — had an increased risk of preterm birth and low-birth weight babies.
If Dr. King’s moral arc does in fact bend toward justice, it still has a long way to go. When people are marginalized, even unintentionally, it inflicts a toll. Discrimination raises many moral concerns — but also, it seems, many medical ones.
Time for Democrats to unite around Medicare for all
by Katrina vandan Heuvel - Washington Post - June6, 2017
“It’s an unbelievably complex subject,” President Trump said in February, discussing the Republican plan to repeal the Affordable Care Act. “Nobody knew health care could be so complicated.” It was a typically absurd proclamation for the president, who more recently bragged about how quickly he mastered “everything there was to know about health care.”
As complicated as health care is, the case against Trump’s health-care bill is simple. Trump promised to provide “insurance for everybody”; the American Health Care Act passed by the House last month would cause 23 million Americans to lose their coverage. Trump promised not to cut Medicaid; the AHCA would slash more than $800 billion from the program. Trump promised to protect people with preexisting conditions; the AHCA would allow discrimination against such patients. As National Nurses United Executive Director RoseAnn DeMoro put it, Republicans are essentially proposing “a 21st Century version of ‘Lord of the Flies.’ ”
For Democrats, opposing Trump’s plan, which a measly 8 percent of Americans support in its current form, is a no-brainer. But with health care emerging as the American people’s top concern , according to recent polls, Democrats would be wise to seize the moment, go on the offensive and rally around a bold alternative to the Republican Party’s backward vision. It’s time for progressives and Democrats to unite behind Medicare for all.
Under a Medicare-for-all, single-payer system, the United States would join virtually every other Western country in recognizing health care as a fundamental right and providing insurance for every citizen. It would reduce the burden on employers, which bear the brunt of the cost of insurance today, and it would bring down overall health-care costs because Medicare is more efficient than for-profit private insurance. It would be paid for with tax hikes on the wealthiest Americans, including a financial transactions tax that would curb risky high-frequency trading.
Contrary to how it is often portrayed, this is not some left-wing fantasy but an idea with widespread across-the-aisle support. An April survey from the Economist/YouGov showed that 60 percent of Americans support “expanding Medicare to provide health insurance to every American,” including a majority of independents and nearly half of self-identified Republicans. Likewise, a Gallup poll conducted last month found that a majority of Americans would like to see a single-payer system implemented. (Given how deeply Medicare is woven into the fabric of our society, I prefer the term “Medicare for all” over the wonky “single-payer.”)
This is not to say that Democrats should stop defending the Affordable Care Act, which is more popular now that it is being threatened than ever before. The law was clearly a major step forward, as evidenced by the 20 million Americans who gained coverage because of it. But the most compelling argument for the Affordable Care Act was always that it was just that: not the final destination but a step in the right direction. “For me, this legislation represents progress toward universal health care for all Americans,” Rep. Keith Ellison (D-Minn.), a longtime supporter of Medicare for all, said when it passed in 2010 . “It is a beginning — and an important one.”
Today, with Republicans fighting to put universal coverage further out of reach, more progressives and Democrats are recognizing that now is the moment to push Medicare for all. A bill introduced by Rep. John Conyers Jr. (D-Mich.) in the House has 112 co-sponsors, representing a solid majority of the Democratic caucus, up from just over 60 in the last Congress. Sen. Bernie Sanders (I-Vt.), who made Medicare for all a central plank of his presidential campaign platform, is preparing to introduce a bill in the Senate. And last week, supporters of Medicare for all scored a big victory when the California Senate advanced a state-level single-payer bill that DeMoro hailed as a “moral model” for the country.
Looking ahead to 2018, strong progressive candidates are already making universal coverage part of their pitch to voters. In Iowa, nurse and union leader Cathy Glasson has launched a gubernatorial bid with a promise to provide “universal healthcare to cover every Iowan.” And in Maryland, former NAACP president Ben Jealous, who endorsed Sanders in 2016, is running for governor, pledging to “ensure that every citizen” in the state is covered.
It will take smart organizing and tireless work to make it a reality, but Medicare for all is an idea whose time has come. With organizations such as Our Revolution, National Nurses United and the Working Families Party leading the fight, though, the movement for Medicare for all is gaining momentum every day.
During the floor debate over the Affordable Care Act, Sanders declared, “The day will come, although I recognize it is not today, when the Congress . . . will finally proclaim that health care is a right of all people and not just a privilege.” He was right then, and he’s right now. But it won’t happen until progressives drive the debate to the point that Medicare for all is seen not as impossible, but inevitable.
Single-payer bill could bankrupt California
by Marc Joffe - California Policy Center - June 5, 2017
The state Senate’s vote to pass Ricardo Lara’s single-payer healthcare bill last week was a singular act of fiscal malpractice. By failing to control costs and access to the program – and by leaving unanswered how or whether federal funds could be leveraged – Lara’s Healthy California Act amounts to a blank check for hospitals, doctors and pharmaceutical companies on the state Treasury, a blank check that could well bounce once it’s presented to Sacramento.
While there are many reasons to dislike the concept of single-payer health coverage generally, the fact is that it can be made to work on some level. The United Kingdom and Canadian provinces have implemented forms of single-payer coverage, without causing a fiscal meltdown and while achieving acceptable life expectancies (although both systems suffer from long waits for certain medical services).
But the UK and Canada accomplish this outcome through cost controls missing from Lara’s bill. For example, these systems do not normally provide free healthcare to undocumented residents. To qualify for Ontario’s Health Insurance Plan one must not only live in Ontario but must also be a Canadian citizen or legal resident. The province recommends that visitors purchase private medical insurance. The UK National Health Service also has provisions to charge individuals who are not legal permanent residents.
By contrast, Lara’s bill provides free healthcare to any “individual whose primary place of abode is in the state, without regard to the individual’s immigration status.” With healthcare costs now averaging about $10,000 per capita, the state’s free healthcare will create a strong incentive for people to come to California illegally or overstay their visas.
And this incentive is not limited to foreigners; individuals from other states diagnosed with expensive medical conditions could legally move to California, establish residency and start obtaining free medical care. Although the bill does not define what would be required to establish residency, the published criteria for getting a California driver’s license – a potential model – are quite lenient. If that is the standard, one would merely need to produce a lease and a voter registration postcard to qualify.
The UK and Canadian systems also limit the types of care eligible for coverage. As I discussed in a March 2017 article for The Fiscal Times, the UK National Health Service generally does not provide mammograms for women under 50, does not offer routine colonoscopies and does not cover circumcisions for newborn boys. In Ontario, the government dropped coverage for eye exams, chiropractic treatments and physiotherapy in 2004.
By contrast, the Healthy California Act proposes to cover “all medical care determined to be medically appropriate by the member’s healthcare provider.” Further, plan members “shall not be required to pay any premium, copayment, coinsurance, deductible, and any other form of cost sharing for all covered benefits.”
Although the bill claims to create “a healthcare cost-control system,” it does not contain any specific cost control provisions. There is no gatekeeper charged with saying “no, this test, procedure or medication should not be covered.” With patients paying nothing out of pocket and health providers getting reimbursed for whatever they recommend, the incentives for overtreatment are strong.
Indeed, the bill shreds privately implemented cost controls that have proven themselves over decades. Kaiser Permanente, operating since 1945, covers 8.5 million Californians through a system of managed care. Kaiser generally provides all healthcare services to its members, charging them a flat annual insurance fee and copays for physician visits. This gives Kaiser both the ability and incentive to restrict unnecessary or redundant treatment. As a result, Kaiser provides high-quality care at low cost: that’s what makes it a national model.
Lara’s bill tosses out this model. With the state taking over all medical payments, Kaiser would be obliged to become a “fee for service” provider if it wanted to continue operating in California. The legislation would thus force more than 20% of Californians out of a system that effectively controls cost to the mainstream U.S. approach that has led to the world’s highest healthcare expenditures.
Single-payer advocates often emphasize the opportunity to save money by eliminating insurance company profits. But Kaiser is not-for-profit, as is Blue Shield, which covers another four million California residents.
Also, insurance company profits don’t necessarily increase health costs – if these profits are offset by cost savings. For example, the Mexican health insurance company SIMNSA offers California health insurance plans that use providers across the border in Tijuana and Mexicali. Because healthcare in Mexico is so much less expensive than it is in the U.S., the carrier can save customers money while making a profit. Cross-border insurance arrangements like the one offered by SIMNSA would also be wiped out by Lara’s bill.
While other insurance providers may not be able to offer the unique product SIMNSA provides, all have an incentive to control costs, by, for example, limiting fraudulent claims. By contrast, the nation’s main single-payer system, Medicare, is racked by fraudulent and other improper payments.
By removing cost-control incentives and providing first-dollar coverage to all comers, the Healthy California Act is likely to cost well above the $400 billion mentioned in a Senate Appropriation Committee report.
There’s another risk – that California would not be able to fully leverage the $200 billion in federal funds now devoted to California healthcare. Most federal healthcare spending in California is related to the Medicare and Medicaid programs. Medicaid, known as Medi-Cal in California, is administered by states with federal matching funds under federal guidelines. States can request waivers from the federal Medicaid guidelines under Section 1115 of the Social Security Act. Any program waivers must not increase federal spending and are issued at the discretion of the Secretary of Health and Human Services. The odds of obtaining a Medicaid waiver appear low as long as Republicans control the White House. Since Medicare is solely administered by the federal government, there’s no such thing as a state Medicare waiver.
If California Democrats were serious about implementing a cost-effective single-payer system, they would work with Congressional Republicans to make federal funding more flexible. The American Health Care Act (AHCA) passed by the House gives states the option of receiving a block grant in lieu of Medicaid matching funds and provides each state with new funding to stabilize their insurance markets. If these state subsidies were further expanded and made less restrictive, it would be easier to integrate the federal funds into a state single-payer system.
But Nancy Pelosi and other congressional Democrats have expressed no interest in working with the GOP. Indeed, they made an especially ironic criticism of the AHCA process – excoriating House Republicans for passing the bill before the Congressional Budget Office had an opportunity to update its budgetary score. In the end, CBO found that AHCA would reduce the federal deficit by $119 billion over 10 years, somewhat less than the previously scored revision of the bill.
By contrast, Ricardo Lara did not ask the California Legislative Analyst’s Office to score his bill, even though an initial guestimate suggests that it would balloon state spending by $200 billion per year, or more than $2 trillion over the normal 10-year budget window used by CBO.
The state Senate has passed a bill that, if it becomes law, will have the largest fiscal impact in the history of California, and it will do so without having an objective body of budget experts review the legislation. Given this lack of oversight and the aforementioned risk of serious cost overruns, the Senate’s ratification of Healthy California is the greatest case of fiscal malpractice in the state’s history – and one that threatens to flatline our state’s budget and economy.
http://californiapolicycenter.org/single-payer-bill-bankrupt-california/
Editor's Note: Actually, I agree with the preceding article. The bill is a step forward as far as it goes, but needs to incorporate much stronger cost-control measures. Consolidating sources of payment into a single risk pool would provide the policy tools to do just that, but they have to be implemented. In other words, the bill provides the platform for more effective and less intrusive cost containment than currently exists, but needs to be refined with that very necessary goal in mind.
-SPC
Editor's Note: Actually, I agree with the preceding article. The bill is a step forward as far as it goes, but needs to incorporate much stronger cost-control measures. Consolidating sources of payment into a single risk pool would provide the policy tools to do just that, but they have to be implemented. In other words, the bill provides the platform for more effective and less intrusive cost containment than currently exists, but needs to be refined with that very necessary goal in mind.
-SPC
Senate GOP aiming to conclude divisive health-care push — one way or the other
by Sean Sullivan and Kelsey Snell - Washington Post - June 6, 2017
Senate Republican leaders are aiming to conclude their perilous and divisive effort to rewrite the nation’s health-care laws as soon as late this month, giving themselves only weeks to resolve substantial disagreements and raising the possibility that their push will collapse.
The leadership team is eyeing a vote by the end of July on a bill to be completed by early that month, with some aspiring to wrap up even sooner, as they cast ahead to the other legislative priorities on the horizon. One said he expected to hold a vote on a bill even if it lacked the support to pass, underscoring a growing desire to bring a difficult debate to a close one way or the other.
Some Senate Republican aides and associates are already privately discussing how the GOP would craft its midterm campaign message if it fails to pass a health-care bill, suggesting they could tell voters they need to build a bigger majority to finally undo the Affordable Care Act, known as Obamacare, as they have long promised.
There is also rising pessimism among rank-and-file Republican senators about the prospect of reaching consensus on legislation to make good on a signature campaign promise, highlighting the steep climb they face to securing the 50 votes they need to pass a it.
“I still think in the end there’s a huge reason why we have to get to 50 on this,” said Senate Republican Conference Chairman John Thune (R-S.D.) on Monday. He added: “Obviously, we’re going to have a vote one way or the other, but if we don’t pass something and we go into ’18, you know, it’s on us to try and get this fixed.”
Thune said he hoped a vote could be taken during “this work period,” but stressed that it would be up to Majority Leader Mitch McConnell (R-Ky.) to decide when a vote would happen. The Senate’s next week-long recess begins at the start of July.
Senate Republican Whip John Cornyn (R-Tex.) said, “We have to get this done by the end of the July because then we need to get on to taxes in the fall.” He was referring to tax-code revisions, another legislative priority Republicans have established for themselves.
Cornyn and Thune made their comments as they walked in and out of a late-afternoon meeting in McConnell’s office that included other key GOP senators. The Kentucky Republican and his team are expected to present rank-and-file GOP senators with several potential policy options throughout the coming week, including at a weekly luncheon on Tuesday afternoon.
“A little bird told me that something like that might be rolled out,” Cornyn said. “But, you know, we’ve been talking about this for seven years. And so now is the time to start coming up with some tangible alternatives and building consensus. So, suits me.”
But agreement has been very difficult for Senate Republicans to achieve amid dissent over significant policies. The biggest issues they are trying to sort out: how Medicaid should be structured and funded, whether to allow states to avoid certain Obamacare regulations and how to craft tax credits to replace existing insurance subsides.
Senate GOP leaders could present options on these fronts this week as well as on repealing taxes in the ACA, according to several senior GOP aides. It’s unclear when a physical draft of the bill will be produced.
Sen. Shelley Moore Capito (R-W.Va.), who represents a state that expanded Medicaid under the ACA, said as she walked into McConnell’s office that she would support a slower phaseout of Medicaid expansion than was established under the health-care bill that passed the House early last month. But she added: “I’m not saying I support phasing it out.”
Thune has been looking at ways to adjust the tax credits in the House bill to offer more assistance to elderly and lower-income Americans.
It remains unclear, however, whether hard-line conservative senators will support such proposals in a final vote.
The differing ideas reflect not only contrasts in policy but sensitivities to opposite ends of the political spectrum, with some concerned about an electoral backlash from centrist or left-leaning voters who oppose major changes to Obamacare and others worried a less aggressive assault on the ACA will leave right-leaning opponents of the law dispirited.
All the behind-the-scenes work and discussion with those parameters in mind, however, has not generated confidence in some Republican senators. Some have openly doubted that the talks are leading anywhere positive.
Sen. Lindsey O. Graham (R-S.C.) said Monday that he doesn’t think Republicans will pass a health-care bill in 2017, Bloomberg News reported. Over the Memorial Day recess, Sen. Richard Burr (R-N.C.) came to the same conclusion and Sen. Jeff Flake (R-Ariz.) said he doubted a bill could pass before the August recess.
There is a growing sense among Senate Republicans that they need to either pass a health care overhaul or move on to other ways of fixing the health-care system, possibly through a tax reform bill or in smaller bipartisan legislation later this year.
Some want to move on so that Congress can focus on pressing deadlines in the late summer and early autumn, including a vote to increase the federal borrowing limit that could come as early as mid-July. Republicans have also suggested that they want to begin negotiations with Democrats on a long-term spending bill before Sept. 30 when the fiscal year ends.
The small window for action and policy disagreements has upped the chatter among Senate GOP aides and associates that making good on their often-repeated promise to undo parts of Obamacare may not be possible. Many Republicans, including top aides working on the GOP health plan, said they need to vote on health care and move on by early July, even if that means voting on a bill that fails.
“Quietly, people are preparing for a lot of possible outcomes and how to deal with them,” said one Republican in frequent communication with Republican senators and staff, who like other aides and allies interviewed for this story were granted anonymity to speak candidly.
Much of the serious policy work has been conducted behind the scenes by a small group of health policy staffers, with members of McConnell’s inner circle leading the political strategy, according to top GOP aides familiar with the negotiations. Experts have been working to craft a number of policy options that lawmakers can mix-and-match to create a final policy outline.
Senate Budget rules allow GOP leaders to scrap nearly every element of the health legislation that passed the House. The only requirement is that the Senate save $133 billion, the same amount saved in the House bill.
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Republicans are trying to pass a health-care bill through a procedural maneuver known as reconciliation that only requires a simple majority rather than a supermajority. But for McConnell, getting to 50 votes (Vice President Pence could break a 50-50 tie) means losing no more than two Republican senators.
Complicating matters further, leaders must also jump through a series of other procedural hoops, like waiting for an official cost estimate before the health-care bill can come up for a vote. That process typically takes around two weeks, meaning leaders would need to have a final bill in hand soon to get it scored and hold a vote by the end of next month.
Some Republican leaders sound much more like they are wishing that will happen than are counting on it.
“I don’t think this gets better over time,” said Senate Republican Conference Vice Chairman Roy Blunt (Mo.). “So my personal view is we’ve got, you know, about until now until the Fourth of July to decide whether the votes are there are not. And I hope they are.”
Collins says Maine may want to follow Indiana’s lead on Medicaid
By Steve Collins - Lewiston Sun Journal - June 6, 2017
Whether Maine should expand its Medicaid program to cover tens of thousands more people has long been a hotly debated issue — one that may be decided at the ballot box in November.
But until now, Republican U.S. Sen. Susan Collins has remained above the fray, focused on trying to come up with a national health care measure that could appeal to the American mainstream.
Over the weekend, though, Maine’s senior senator told The New York Times that she thinks her state should embrace a Medicaid expansion modeled on the one that Indiana adopted while Vice President Mike Pence served as its governor.
“I recognize that it’s not my call,” Collins said Monday. But, she said, the idea “is worthy of consideration in Maine.”
Indiana won approval for its variation in 2015 to require that low-income residents pay into savings accounts whose funds are applied to cover part of their insurance premiums. They also typically have co-pays that fall on their shoulders.
Collins said Indiana’s model has worked well, provided insurance to many who lacked it and delivered “a very high satisfaction rate.”
Its success, she said, is attributable to its ability to keep patients “vested in their health care decisions,” reducing the number unnecessary and costly emergency room visits and promoting more use of primary care doctors and urgent care centers.
If Maine decides to pursue the idea, Collins said, it would benefit from studying Indiana’s experience.
Pence once declared the expanded program focused on “respecting the dignity of every Hoosier, including our working poor, to find a way to cover themselves and their families, respecting their ability to make their own health care decisions and empowering them to lead better and healthier lives.”
Parts of Indiana’s expanded program aren’t all that different from what Gov. Paul LePage’s administration is angling to impose on Maine’s existing Medicaid program.
LePage is seeking to revise MaineCare to add asset tests, time limits and monthly premiums for some current recipients.
Among the things Indiana’s program does in addition is to provide coverage for people making up to 138 percent of the federal poverty line. Maine’s program only covers people who are below the poverty line.
At this point, there are 31 states that have expanded their Medicaid programs — nearly all of them without the tough standards Indiana added with President Barack Obama’s approval — and 19 that have refused to take advantage of the extra federal funding attached to the expansion.
Collins said another advantage of the managed care avenue that Indiana and some other states, including Ohio, have adopted is that if the House is successful in reducing payments for Medicaid, it won’t have as big an impact on those who rely on the program as it will for states with more open-ended programs.
Democrats are pushing to expand Medicaid in Maine along the same path that most states have followed. They’ve also spoken out against the sorts of restrictions Indiana includes.
Rep. Patty Hymanson, D-York, for example, decried LePage’s bid to alter MaineCare by calling the proposed changes “directly contrary” to the purpose of Medicaid.
“It creates unnecessary barriers that will ultimately restrict access, at a time when affordable and accessible health care should be expanding,” she said in a prepared statement.
The referendum slated for this year’s general election ballot would require Maine provide MaineCare services to those younger than 65 — the age when Medicare kicks in — who have an income at or below 138 percent of the federally defined poverty level.
“The best way of ensuring health coverage and saving lives is passing the Medicaid expansion referendum on the ballot this November,” Mike Tipping, who works at the Maine People’s Alliance and Maine People’s Resource Center and helped push for the public vote, said.
Tipping said Monday that the ballot initiative is similar to policies already approved by large majorities in the Maine House and Senate, measures that Gov. Paul LePage vetoed.
Tipping said that in addition to providing health care for more than 70,000 more Mainers, Medicaid expansion would bring in $500 million in additional federal funds and “create more than 3,000 good health care jobs, predominately in rural areas.”
He said the extra help will also boost the efforts to deal with Maine’s opioid epidemic.
The Healthy Indiana Plan that Collins is eyeing includes more than simply finding ways to make low-income Hoosiers pay part of the cost.
It also expands access to substance abuse treatment and offers benefits for those who quit smoking, follow chronic disease management programs and participate in other initiatives that seek to boost their overall health and fortunes.
Collins has introduced a health care proposal in the Senate along with Sen. Bill Cassidy, R-Louisiana, that seeks to carve out a middle ground on the issue by giving states more flexibility, including the right to leave Obama’s Affordable Care Act insurance exchanges in place.
It hasn’t gotten much traction on Capitol Hill, but it remains part of the discussion about possible alternatives to the House-sponsored Affordable Health Care Act whose impact would appear to be pretty dire if the Congressional Budget Office’s projections are valid.
Senate leaders are trying to craft a proposal that can secure enough votes to pass, but many senators have expressed doubt that it can be done anytime soon.
Collins, who has served in the Senate for two decades, is contemplating a possible gubernatorial run next year to succeed LePage, who is barred from the race because of the term limit law.
Obamacare Didn’t Destroy Insurance Markets, but It Also Didn’t Fix Them
by Reed Abelson and Haeyoun Park - NYT - June 6, 2017
Most Americans get health insurance from a job or government program, but about 8 percent, or some 22 million people, now buy individual policies under the Affordable Care Act. Insurers began offering these plans in 2014.
How Americans under 65 get health insurance
In Obamacare
marketplaces
Outside the
marketplaces
Republican lawmakers and President Trump have criticized Obamacare, saying it took away people’s ability to choose their health plans and doctors, pointing to a recent exodus of insurers that could leave areas with a single insurer or none at all. Mr. Trump has insisted the markets are failing.
And the markets took another hit on Tuesday when Anthem, one of the nation’s largest insurers, pulled out of Ohio, leaving about 20 counties with no Obamacare carrier.
Supporters of the Affordable Care Act hoped the law would spur more competition among insurers across the country.
But so far, the law has not delivered on that promise, especially in states that never had much competition, but it didn’t create the lack of choice in those states, according to a Times analysis of insurer participation provided by the Robert Wood Johnson Foundation.
The data looks at state markets where all insurers must sell plans that meet Obamacare standards, regardless of how they’re purchased.
More than half of the 22 million people who buy their own insurance use Obamacare marketplaces, where most of them get a federal tax credit to help pay for coverage. The rest buy directly from an insurer or broker, and they do not get a tax credit.
In South Carolina, for example, only one insurer is selling through the marketplace, but there are four over all that offered Obamacare plans in 2017.
Despite insurer exits, the market size hasn’t declined much.
The total number of insurance companies now selling plans in the individual market is not that different from when Obamacare took effect in 2014.
Total number of insurers in the individual market
Note: Chart shows parent companies selling plans that meet Obamacare standards.
One of the goals of Obamacare was to prevent the sale of “junk” insurance, which was much cheaper but wouldn’t pay more than a few thousand dollars in claims. So, initially, there was a sharp decline in carriers — nearly 200 of them left when the new law required insurers to offer comprehensive coverage.
A small surge followed in 2015, but companies have steadily left since. Most of the so-called co-ops created under the law to foster competition failed, and some of the largest insurers, like UnitedHealth Group and Aetna, also exited many of the markets after reporting that they lost hundreds of millions of dollars.
The continued struggle of some insurers to make money and the uncertainty over the future as Republicans talk of dismantling the law has led to defections of prominent insurers like Humana and Wellmark, a Blue Cross plan from Iowa, for 2018.
But the biggest drop in insurers is among those who sell plans exclusively on the Obamacare marketplaces.
Where insurers are selling
In Obamacare
marketplaces only
Outside Obamacare
marketplaces only
Many companies — a third of the total — are choosing to sell outside the Obamacare marketplaces, where their customers are not eligible for federal subsidies.
Where insurers sold in 2017
Outside Obamacare
marketplaces only
In Obamacare
marketplaces only
One reason for that may be that people with higher incomes, who don’t need federal subsidies, tend to be healthier.
A new analysis by the Trump administration says the cost of insurance is higher now than before Obamacare. But the comparison does not include people who buy outside the Obamacare marketplaces, where premiums may be lower. It also does not reflect the lower premiums paid by a majority by people who receive federal tax credits.
The most competitive states have always been that way.
Even before Obamacare, there have always been two distinct markets: states that still have plenty of competition and states that rely heavily on one or two insurers.
“It is remarkable how much of a connection there seems to be between a state’s current situation and their pre-A.C.A. environment,” said Katherine Hempstead, a policy expert at the Robert Wood Johnson Foundation, who recently wrote an analysis of the market.
In 15 states, eight or more insurers offer Obamacare plans. They are mostly the same ones where no single insurer had a dominant share of the market in 2013, before the law was enacted.
States where no insurer had
market dominance in 2013
States with eight or more
insurance carriers in 2017
Big states like Pennsylvania and Texas, with major cities, have always appealed more to insurers because they offer a large pool of potential customers, and the companies can strike better deals with some of the hospitals and doctors. But states with more rural populations and poorer residents tend to struggle because insurers are reluctant to enter markets where there are fewer customers that may be costly to cover.
The least competitive states never had much to begin with.
But the 19 states that currently have fewer than five carriers statewide are all ones where a single insurer had more than half of the overall market before Obamacare.
States where one insurer had
market dominance in 2013
States with fewer than five
insurance carriers in 2017
The largest insurer was typically a local Blue Cross plan, which offers coverage within a state and works closely with local hospitals and doctors.
In Alabama, Rhode Island and Vermont, the Blue Cross plan covered about nine out of every 10 people.
The local Blue Cross plan is often the remaining stalwart in states with little competition, especially in the Obamacare marketplaces, although there have been a few exits to date.
The Blue Cross plans “are carrying the exchange markets right now,” said Cynthia Cox, a policy expert at the Kaiser Family Foundation.
Anthem Will Exit Health Insurance Exchange in Ohio
by Reed Abelson - NYT - June 6, 2017
Anthem, one of the nation’s largest insurers and a major player in the individual insurance market created by the federal health care law, announced Tuesday that it would stop offering policies in the Ohio marketplace next year.
Although its departure would leave a small number of people — roughly 10,500 who live in about a fifth of the state’s counties — without an insurance carrier, the move was seized on by Republicans as more evidence that the markets are “collapsing” under the Affordable Care Act. President Trump, meeting with congressional leaders on Tuesday, said it was more proof that insurers are “fleeing and leaving” the marketplaces and added that it was essential for Congress to pass a bill repealing the health law this summer.
Republican senators said on Tuesday that they were trying to reach agreement on some major issues, especially Medicaid.
Senator John Barrasso, Republican of Wyoming, said that Republican senators spent much of a meeting on Tuesday with Vice President Mike Pence discussing health care. Mr. Barrasso outlined some differences with the bill that passed the House.
The senators want “a smoother glide path, rather than an abrupt cutoff,” of Medicaid expansion funds that the federal government provides in 31 states, he said.
Some senators have also expressed concerns about provisions in the House bill that would allow states to seek waivers from certain federal insurance standards, including one that prohibits companies from charging higher premiums to people with pre-existing conditions. Senate Republicans, however, have not agreed on which provisions could be waived.
Congressional Republicans have said they plan to provide tens of billions of dollars to hold down premiums, stabilize insurance markets and help cover high-cost patients in the next decade. But it is unclear whether an injection of federal money will come soon enough to influence other insurers’ decisions about participating in the marketplaces in 2018.
Besides Ohio, Anthem operates for-profit Blue Cross plans in more than a dozen states. The company said on Tuesday that it had not yet made a decision about its participation in those exchanges, but it and other companies have grown increasingly anxious as efforts by Congress drag on.
Senator Rob Portman, Republican of Ohio, said the exit of insurers was “a problem not just in Ohio but across the country,” and he blamed the existing law for “a declining number of viable health care choices for families and small businesses.”
Democrats countered that the market is shaky because of efforts by the Trump administration and congressional Republicans to undermine the law, including their continued threat to stop providing critical funding to low-income individuals to better afford plans.
“They own this health care system now,” said Senator Sherrod Brown of Ohio. “Because they fiddled for the last five months and injected more uncertainty into the insurance market, premiums have gone up and insurance companies have pulled out.”
Federal and state deadlines are quickly approaching this month for insurers to decide if they will remain in the marketplaces and how to price their plans for 2018.
While Anthem had warned that it might leave some or all of the states where it offers individual plans, its exit from Ohio signals that even some of the market’s stalwarts are unnerved. Aetna and Humana have said they do not plan to participate next year after losing money, but Anthem appeared be turning the corner.
If Anthem were to exit the federal health insurance exchanges entirely, “there could be hundreds of thousands of people without any option on the exchange,” said Cynthia Cox, an executive at the Kaiser Family Foundation.
In the last few weeks, two other Blue Cross companies announced that they were dropping out of exchanges, in Nebraska and in parts of Kansas and Missouri. Iowa’s Blue Cross plan has also said it does not plan to offer plans on the exchange next year.
The exit leaves insurance regulators with the prospect that some of their residents may not be offered a plan in 2018.
“For the past few years we have seen a weakening in the federal insurance marketplace as a number of companies have withdrawn from the exchange,” the Ohio insurance agency said in an email. “We have always argued the private insurance market is the most severely impacted by the federal law and that is where congressional action is needed to restore stability.”
Even when insurers are staying, the uncertainty and concern over the health of people in the market is leading many to file eye-popping rate increases for next year. In Maine, Harvard Pilgrim Health Care is asking for an average price increase of about 40 percent, while Anthem, which warned state regulators that it might have to revisit its plans, depending on what happens, wants a 21-percent increase.
Some state regulators are asking the insurers to file various rates based on what happens, but the different scenarios can lead to much higher rates. In Pennsylvania, Teresa Miller, the state’s insurance commissioner, said in a statement this month that the five carriers had requested an average increase of 9 percent, demonstrating that the market “is stabilizing and insurers are better understanding the markets and the population they serve.”
But the increases could be much higher. Prices would go up by 20 percent if there was no longer funding for subsidies, the regulator said. Rates could also be higher if the Trump administration does not enforce the tax penalty on people without insurance.
Nevada's legislature just passed a radical plan to let anybody sign up for Medicaid
by Sarah Cliff - VOX - June 6, 2017
Nevada, with little fanfare or notice, is inching toward a massive health insurance expansion — one that would give the state’s 2.8 million residents access to a public health insurance option.
The Nevada legislature passed a bill Friday that would allow anyone to buy into Medicaid, the public program that covers low-income Americans. It would be the first state to open the government-run program to all residents, regardless of their income or health status.
The bill is currently sitting with Nevada Gov. Brian Sandoval, a Republican. His office did not respond to an inquiry about whether he would sign the bill or veto it.
Democrats in Washington have previously proposed a similar “Medicare for all” scheme, which would open up the public program for the elderly to Americans under 65. The idea has always fizzled out, however, due to a lack of political support.
“Medicaid for all” offers an alluring alternative to those proposals. For one, Medicaid coverage generally costs less than “Medicare for all” because the program pays doctors lower rates. This might make it a more alluring option for price-sensitive consumers worried about their monthly premium.
Because states have a large role in running Medicaid, they can move these proposals forward with less involvement of the federal government. A public option program like this has always failed at the federal level. But a liberal state such as Maryland or Connecticut — or, in this case, even a more centrist state like Nevada — might explore the option unilaterally.
This could mean that the path to a public option doesn’t run through Washington, DC. Instead, it runs right through Carson City.
Nevada’s plan to create “Medicaid for all,” explained
Nevada’s bill to allow a broader Medicaid buy-in is short, running just four pages. It would allow any state resident who lacks health insurance coverage to buy into the state Medicaid program, which would sell under the name the Nevada Care Plan.
“There is no way people can be productive members of society and take care of their families if health care is a privilege and not a right,” says state Assembly member Michael Sprinkle, who introduced the measure. “That’s really where this bill started, thinking through, how do we make health care a right in our state.”
Under his bill, people who qualify for tax credits under the Affordable Care Act would be able to use those credits to buy Medicaid coverage instead. People who don’t qualify for anything would be able to use their own money to do the same. The plan would likely sell on Nevada’s health insurance marketplace, making it a public option to compete against the private health insurance plans also selling there.
The buy-in coverage would be pretty much identical to the coverage traditional Medicaid provides, although it would not cover emergency medical transportation (a benefit of the program tailored to the low-income population it traditionally serves).
Sprinkle (who told me his last name has led to some people calling the plan SprinkleCare) says they haven’t yet estimated how much enrolling in the Nevada Care Plan would cost individuals. The bill sponsors also have not determined whether buy-in Medicaid members would have a deductible or traditional copayments, which Medicaid typically does not have because of the low-income population it serves.
“Once the bill gets through the governor, we’re going to have a very active working group that will build off this framework to determine these things through regulation,” Sprinkle said.
Lots of advocates focus on “Medicare for all.” Why not “Medicaid for all”?
Democrats explored the possibility of a Medicare buy-in during the health care debate in 2009 and 2010. The buy-in option was relatively narrow, only allowing Americans over 55 to participate in the program. Those under the age threshold would still be limited to private health insurance plans.
Early versions of the Affordable Care Act included the buy-in provision. But the Senate was forced to drop the Medicare buy-in from its bill when it couldn’t get the entire caucus behind the idea. Health industries fought aggressively against the idea, which could disadvantage insurers by cutting into their market share.
In the wake of Trump’s election, health policy experts have begun to explore whether it might make more sense to build a national health care system around Medicaid rather than Medicare.
“Medicaid is the better fit,” Columbia University’s Michael Sparer recently wrote at the New York Times. It has a more generous benefits package, is less costly and is developing more innovative care-management strategies. Moreover, the integration of the Obamacare exchanges into Medicaid would be relatively seamless: Many health plans are already in both markets.
Medicaid and Medicare are similar programs in that they are publicly run and large, covering 62 million and 43 million Americans, respectively. They can use their large membership to negotiate lower prices with hospitals and doctors. Medicaid tends to have the lowest payment rates. On average, Medicaid pays 66 percent of what Medicare pays doctors.
In Nevada, Medicaid pays 81 percent of Medicare rates.
This has the advantage of keeping Medicaid a relatively low-cost program per person — but also the disadvantage of some doctors deciding not to accept Medicaid’s lower rates. A recent federal survey estimates that 68.9 percent of doctors are accepting new Medicaid patients, compared to 84.7 percent accepting new patients with private insurance.
Still, Medicaid enrollees generally report being relatively happy with their coverage. They look nearly identical to people with employer-sponsored coverage in surveys about how well they think their health plan works.
States have significant sway over how their health insurance programs work and whom they cover. Thirty-two states, for example, have historically participated in a Medicaid buy-in program that lets certain disabled Americans who don’t otherwise qualify for coverage pay to join the program.
States vary significantly in how much pregnant women can earn and still qualify for the program. Some states cover comprehensive dental benefits, while others cover nothing at all.
This variation is an opportunity for states that want to experiment with the public program by tacking on a buy-in option. If Nevada’s bill does become law, it will show other states how such a program might work — and if it works well, liberal states may be inclined to mimic the idea.
But the variation also makes it difficult to see Nevada serving as the start of a national public option. Yale University’s Jacob Hacker argues that while this option might work in a single state, trying to use Medicaid as the model for a national public option would mean people in different states would get significantly different coverage.
“If the argument is this will be a foundation for coverage for everyone, I think that’s questionable,” he says. “It’s going to be difficult to harmonize all the state efforts.”
Will the Trump administration get on board with “Medicaid for all”? Will a Republican governor?
One big obstacle for “Medicaid for all” in Nevada is getting key Republican officials on board.
Gov. Sandoval, a Republican, still hasn’t weighed in on the proposal, although Sprinkle says his staff have been involved in a working group around the bill.
“Anybody would look at this as groundbreaking and trendsetting, and that’s intriguing to a lot of people,” Sprinkle says. “The governor’s office and departments have been integral partners in the working group we’ve had, so that gives me a lot of optimism he’ll sign the bill.”
States that want to enroll new populations into their Medicaid programs typically need permission from the federal government. This means that the Trump administration — which has proposed slashing the Medicaid budget in half — would need to get on board with a significant expansion of the program.
That being said, the Nevada idea in theory shouldn’t expand federal costs. Individuals would be responsible for paying their own way onto the program, although it will likely be a challenge to set the right premium to ensure this outcome.
Again, Sprinkle is optimistic here. He says early conversations with the Center for Medicare and Medicaid Services have been positive, and he expects the administration to be receptive to the program.
As to whether other states might follow the Nevada example, that largely depends on what outcomes it has. If it increases coverage significantly at little cost to the government, state legislators elsewhere would likely take notice. But if it ends up covering few people or increasing government costs, Nevada could become a cautionary tale.
Or as Hacker put it, “When your lab blows up, nobody wants to repeat that experiment.”
https://www.vox.com/policy-and-politics/2017/6/6/15731622/nevada-medicaid-for-all
Nevada Is Considering a Revolutionary Health-Care Experiment
by Ed Kilgore - Daily Intelligencer - June
he U.S. health-care system is, to put it mildly, in a state of flux. The complex system of near-universal access to public and private health insurance created by the Affordable Care Act is being threatened internally by declining insurer participation and externally by the slow-motion riot of Republican plans to repeal and replace it. Within and beyond the Obamacare repeal effort, the Trump administration and congressional Republicans are seeking massive cutbacks in Medicaid funding, partially through a permanent per-capita cap on federal allocations to the states. The CHIP program, a sort of Medicaid supplementary program covering children and run by the states, is up for reauthorization. And in several states, including California and New York, serious initiatives are underway to go in an entirely different direction, with state-run single-payer systems that would in theory replace all existing public and private insurance with a universal insurance plan modeled on Medicare.
In the midst of all this activity there’s a new idea percolating up in Nevada: letting anyone without health insurance buy into the state’s Medicaid program. This would include people who qualify for Obamacare tax credits, which could be used to pay for the buy-in; in effect, that would make Medicaid a public option — a phrase you might remember from Obamacare deliberations, when it was a Medicare buy-in — for individual insurance purchasers. Because of Medicaid’s low reimbursement rates for doctors and other health-care providers (significantly lower than Medicare), it should provide an economical alternative to private insurance, though at the cost of narrower provider options (a significant number of physicians do not accept Medicaid patients). Medicaid also has a broad range of benefits, with no co-pays or deductibles.
A bill to create this new Medicaid buy-in has cleared the legislature, and is awaiting action by Republican governor Brian Sandoval. It is unclear what he will do, though it is noteworthy that he has long been a staunch supporter of the expanded Medicaid program the Affordable Care Act created. Since the legislation leaves a lot of crucial details — e.g., the pricing of the buy-in and the possibility of cost-sharing measures like co-pays or deductibles — to future state regulation, Sandoval may be in a position to shape the proposal to his own liking. Nevada would also need to secure a waiver from the federal Department of Health and Human Services to implement the buy-in; initial indications are that the feds might not have a problem with it so long as it has no impact on federal Medicaid spending in Nevada.
What makes the idea particularly appealing at the moment is that it might be compatible with any of the most likely trajectories of federal health-care policy. A Medicaid buy-in could function quite well under the current Obamacare system — again, as a sort of public option that could be offered alongside private policies on the individual insurance exchanges. But it could also survive a Medicaid per-capita cap or a rollback of the ACA’s Medicaid expansion, since presumably the new enrollees would pay for their own coverage while benefitting from Medicaid’s low costs.
In theory you might expect private insurers to fight a Medicaid buy-in tooth and nail, just as they successfully fought a public option, and also a Medicare buy-in (for people over 55), in the original Affordable Care Act debate. But the vast majority of current Nevada Medicaid beneficiaries are in managed-care plans operated under contract by private insurers, who might view a buy-in as simply a way to get a large number of new customers who might otherwise be uninsured.
It’s also worth noting that during the ACA debate both the Medicare buy-in idea and the more general concept of a public option were quite popular, especially among progressives. So it might also have some bipartisan support. Its chief sponsor in the Democratic-controlled Nevada legislature is Democrat Michael Sprinkle.
So could a Medicaid buy-in offer other states a way out of the problems created by Obamacare’s reliance on unstable private insurance markets and Trumpcare’s crackdown on federal spending? Possibly, though as Sarah Kiliff points out in a Vox overview of the Nevada proposal, it is important to understand that Medicaid already varies a lot from state to state:
[T]his variation is an opportunity for states that want to experiment with the public program by tacking on a buy-in option. If Nevada’s bill does become law, it will show other states how such a program might work — and if it works well, liberal states may be inclined to mimic the idea.
But the variation also makes it difficult to see Nevada serving as the start of a national public option. Yale University’s Jacob Hacker argues that while this option might work in a single state, trying to use Medicaid as the model for a national public option would mean people in different states would get significantly different coverage.
Assuming Sandoval or the Trump administration don’t kill the Nevada proposal outright, the big question will be the buy-in’s pricing. If it’s competitive with current offerings, it could become a pretty big — and good— deal. And if nothing else, it will draw attention to the bargain Medicaid provides for beneficiaries and taxpayers alike.
Selling Doctors on Cutting Drug Costs
by Jay Hancock - NYT - June 6, 2017
As a drug salesman, Mike Courtney worked hard to make health care expensive. He wined and dined doctors, golfed with them and bought lunch for their entire staffs — all to promote pills often costing thousands of dollars a year.
He’s on a different mission now: When he calls on doctors, he champions generic drugs that frequently cost pennies and work just as well as the kinds of expensive brands he used to push.
Instead of Big Pharma, he works for Capital District Physicians’ Health Plan, an Albany, N.Y., insurer. Instead of maximizing pill profits, his job is to save millions of dollars by educating doctors about expensive prescription drugs and the stratagems used to sell them.
“Having come from Big Pharma, I do really feel my soul has been cleansed,” Courtney said with a laugh. He formerly worked for Pfizer and Johnson & Johnson. “I do feel like I’m more in touch with the physicians” and plan members, he added.
Costs for prescription drugs — including generics alongside brand names — have been rising faster than those for any other health care category, marked by high-profile cases such as the reported 400 percent increase for Mylan’s EpiPen and a 5,000 percent spike for Turing Pharmaceuticals’ Daraprim.
Health plans and others paying those costs are fighting back. Many have tried to give doctors academic research on pill effectiveness to help prescribers evaluate claims made by drug sales representatives, or have simply removed high-cost drugs from coverage lists.
Consumer groups and medical societies have tried to spread the word about expensive drugs. One start-up, GoodRx, lets patients compare retail prices online.
C.D.P.H.P., the Albany organization, is one of the few insurers to have taken the battle against expensive pills a step further. It recruits across enemy lines, hiring former Big Pharma representatives and staffing what may be a new job category: a sales force for cost-effective medicine.
“Insurers are taking matters into their own hands,” said Lea Prevel Katsanis, a marketing professor at Concordia University in Quebec, who specializes in the pharmaceutical industry. “They’re saying, ‘We can’t really rely on drug companies to talk to doctors about what’s cost-efficient.’ ”
If insurance companies can curb drug costs, premiums paid by employers, taxpayers and consumers would presumably be under less pressure to rise.
Two years ago, when one company increased the cost of a common diabetes medicine to 20 times what it had been a few years earlier, Courtney and five other former pharma and medical-device representatives working for C.D.P.H.P. knew what to do.
Valeant Pharmaceuticals had cranked up the price of a common dosage of Glumetza, a medicine for lowering blood sugar, to an astonishing $81,270 a year, according to Truven Health Analytics, a data firm. Meanwhile a similar generic version could be bought for as little as a penny a pill.
Because Glumetza was on C.D.P.H.P.’s list of approved drugs, the insurer and its members had to pay for it when doctors prescribed it, resulting in millions of dollars in extra costs and stinging co-payments for patients.
Dr. Eric Schnakenberg, an upstate New York family medicine doctor, was shocked when patients began complaining about what he had assumed was an inexpensive prescription. Doctors, as a group, are famously unaware about the cost of the care they order, a situation that can be exploited by drug sellers and other vendors.
While electronic prescribing programs for physicians and even pharmaceutical guides like the Physicians’ Desk Reference contain information about how to prescribe — some are even peppered with ads — they typically contain no specific information about prices. Drug sales representatives who visit their offices don’t highlight high prices as they drop off free samples, and drug makers can quietly, but substantially, hike the price of a drug from one year to the next.
“As physicians, we’re blindsided by that,” Dr. Schnakenberg said. “We get patient complaints saying, ‘Hey, I can’t afford this,’ and we say: ‘It’s cheap!’ ”
After Courtney and his colleagues alerted doctors to Valeant’s practices, all but a handful of the 60 plan members who were taking Glumetza switched to metformin, the generic alternative. That saved about $5 million in a year.
Following an outcry over its practices, Valeant agreed last year to raise annual prices by no more than single-digit percentages, the company said through a spokesman. But such hikes could still outpace the inflation rate.
The idea to hire Big Pharma representatives originated with John Bennett, a cardiologist, a few years ago, after he became C.D.P.H.P.’s chief executive. He knew that the sales representatives were smart, genial and motivated. Overhiring by the pharmaceutical companies had put many back in the job market.
His sales pitch to them, he says half-jokingly, was: “You know everything they taught you in Big Pharma? How would you like to use those powers for good?”
Pharmaceutical companies spend billions of dollars on television ads, doctor blandishments and expensive sales representatives to keep prescriptions flowing.
Pfizer, Johnson & Johnson and other sellers responded to critics a few years ago by restricting gifts of entertainment, coffee mugs and some meals. But the industry’s ethics code still allows lavish consulting contracts for doctors and sponsorship of physician conferences as well as meals for doctors and their staffs who listen to an “informational presentation” about expensive pills.
“When those products go generic, nobody’s promoting them anymore,” Courtney said. Makers of generics lack big marketing budgets. C.D.P.H.P.’s remedy: The insurer promotes generics with its own representatives.
“It’s a great idea,” said Alan Sorensen, an economist at the University of Wisconsin who has studied drug prices. Referring to doctors, he added that “even a small moving of the needle on their prescribing behavior can have a pretty big impact on costs.”
At first, the team concentrated on educating doctors about cheaper alternatives to Lipitor, a widely prescribed cholesterol-lowering medicine, and Nexium, for stomach problems. That saved about $10 million the first year, much in the form of co-payments that would have been owed by plan members.
Recently the plan has focused on Seroquel, a branded antipsychotic that costs far more than a similar generic. Switching to the generic saves an estimated $600 to $1,000 a month, according to Eileen Wood, the insurer’s vice president of pharmacy and health quality.
C.D.P.H.P.’s repurposed representatives have helped keep the insurer’s annual drug-cost increases to single-digit percentages, she said, adding that without them and other measures, “we would certainly be well into double-digit” increases.
Educating doctors about drug costs is part of a larger push for “transparency” in an industry where the Princeton economist Uwe Reinhardt says consumers face the same experience as somebody shopping in Macy’s blindfolded.
A new study co-authored by Sorensen has found that physicians with access to data about drug prices and insurance coverage are more likely to prescribe generics.
That gives Courtney and his colleagues a fighting chance, even if, he said, “we don’t have the freewheeling, unlimited green Amex card like I did back in the day.”
Senate Health Bill May Alienate G.O.P. Conservatives
by Jennifer Steinhauer and Robert Pear - NYT - June 7, 2017
WASHINGTON — Senate Republicans are closing in on a bill to repeal President Barack Obama’s signature health care law, diverging from the House on pre-existing medical conditions and maintaining federal subsidies that proponents see as essential to stabilizing insurance markets around the country.
The changes appear largely designed to appeal to Republican senators who hail from states where the Affordable Care Act is popular and who were critical of the House bill, which would eliminate insurance for millions of Americans covered under the current law, according to the Congressional Budget Office.
But the revisions may well alienate the Senate’s most conservative members, who are eager to rein in the growth of Medicaid and are unlikely to support a bill that does not roll back large components of the current law. Even with more moderate Republicans on board, party leaders would have a very narrow margin for passage on the Senate floor.
“I think it’s fair to say that the House bill was something necessary to move it to the Senate, but I don’t think that anyone expected that the House bill would define what the Senate did,” said Senator Bill Cassidy, Republican of Louisiana, who called the chances for approval in the Senate “better than 50-50.”
Republicans appeared to be on a swift march to repeal the Affordable Care Act when the new Congress convened this year, even as Democrats were determined to preserve the law. The deterioration of health insurance markets in some states has added to the pressure on lawmakers to take at least some action in the next few months.
Senate Republicans, meeting daily behind closed doors, are coalescing around a proposal that would provide money for “cost-sharing reduction” payments, which insurance companies receive under the Affordable Care Act so they can reduce deductibles and other out-of-pocket costs for low-income consumers.
House Republicans filed a lawsuit in 2014 asserting that the Obama administration was paying the subsidies illegally because Congress had never appropriated money for them, and a Federal District Court agreed last year. The conflict puts the Senate on a potential collision course with both the House and the White House, which has sent decidedly mixed messages on what it wants to do with the subsidies, causing insurers to panic.
Senator Rob Portman, Republican of Ohio, said Congress needed to provide money for the cost-sharing subsidies. “The administration has delayed a decision from month to month,” he said. “We need to deal with it as soon as possible to provide some stability in the market.”
Mr. Portman noted that Anthem, one of the nation’s largest insurers, cited uncertainty about the payments when it announced this week that it would pull out of Ohio’s health insurance exchange next year, leaving consumers in some counties without options.
Insurers, doctors, hospitals and the United States Chamber of Commerce have been urging President Trump to ensure payment of the subsidies. But Mr. Trump has threatened to withhold them as a way to force Democrats to negotiate with him on a replacement for the 2010 health care law.
Seven million people benefit from the cost-sharing subsidies, which cost the federal government $7 billion a year. The House bill did not include money for them, and Mr. Trump’s mixed signals have spooked insurers.
The Trump administration has also indicated that it will loosen enforcement of the requirement for people to have coverage or pay a penalty.
Harvard Pilgrim Health Care cited uncertainty about that requirement, the individual mandate, as one reason it proposed rate increases that would raise the average monthly premium in the Maine marketplace by 39.7 percent, to $655 in 2018 from $469 this year.
Republican senators are still waiting for more details, and an evaluation by the Congressional Budget Office of the Senate measure’s cost and impact, before agreeing to support any legislation that would fulfill years of Republican promises to unravel the health care law.
Democrats, who have been left out of a process that requires only 51 votes, are almost certain to be critical of the measure, which goes well beyond changes needed to solve problems now roiling insurance markets in many states.
“We have not been included in any of these discussions,” said Senator Patty Murray, Democrat of Washington. “Clearly, they want to move forward and get this monkey off their backs, but it is a monkey, and they’re going to pay the price if they go that direction.”
Senator Mitch McConnell of Kentucky, the majority leader, has a narrow pathway to victory. Only two of the chamber’s 52 Republicans can abandon him, with Vice President Mike Pence then breaking a tie vote.
Senator Rand Paul, Republican of Kentucky, is widely expected to oppose any bill that does not at least mirror the House measure in rolling back federal insurance standards, and Senator Mike Lee, Republican of Utah, is likely to have similar concerns. Senator Patrick J. Toomey of Pennsylvania is looking for deeper cuts in the projected growth of Medicaid, which could turn off other Republican senators, including some from states that expanded the program.
Under the bill passed by the House last month, states could opt out of certain provisions of the Affordable Care Act, including one that requires insurers to provide a minimum set of health benefits and another that prohibits them from charging higher premiums based on a person’s health status.
Senate Republicans generally agree that it is desirable to give states more flexibility, allowing them to obtain waivers from the federal definition of “essential health benefits,” such as maternity care, emergency services and mental health coverage.
But many Republicans are reluctant to dilute the protections for people with pre-existing conditions. Asked if insurers should be allowed to charge higher rates to people with such conditions, Mr. Cassidy said, “The simple answer is no.”
Congress has roughly 30 legislative days to pass a bill before the August recess. If the Senate is able to pass one by then — a goal of Mr. McConnell — it is very unclear whether its provisions could be melded with those in the House version.
On a trip to Ohio on Wednesday, Mr. Trump again pressed for a bill. “Obamacare is in a total death spiral, and the problems will only get worse if Congress fails to act,” he said. “It’s only obstruction from the Democrats. The Democrats are destroying health care in this country.”
With no prospect of votes from Democrats, he said, “it’s all going to be Republicans or bust.”
Moody’s downgrades bond rating for owner of Mercy Hospital
Eastern Maine Healthcare Systems says the low credit rating that stems from a $34.3 million loss in its 2016 fiscal year 'has no effect on care delivery.'
by J. Craig Anderson - Portland Press Herald - June 8, 2017
A bond credit rating agency has downgraded Eastern Maine Healthcare Systems’ rating to a level that could limit the organization’s ability to obtain credit.
Moody’s Investors Service said the downgrade to junk bond status reflects “a material operating loss and budget shortfall” for the health system’s 2016 fiscal year. According to its 2016 annual report, EMHS experienced an operating loss of $34.3 million during its 2016 fiscal year, which ended in September, compared with a $5.7 million operating loss for the previous fiscal year.
A spokeswoman for Brewer-based EMHS – which operates multiple hospitals in Maine, including Mercy Hospital in Portland – said the “credit rating has no effect on care delivery.”
Moody’s also attached a negative outlook to its rating, a reflection that EMHS is facing “lower than expected liquidity, concurrent with significant risks related to large systems consolidations and migrations.” The change to “Ba1” from “Baa3” lowers the system’s bond rating to below investment grade, commonly referred to as junk bonds. Such a rating means that investment in the organization’s bonds is considered too risky for the typical institutional investor, making it hard for the organization to raise money.
“While management expects long-term benefits from IT initiatives, potential short-term disruptions include productivity declines, collections slowdowns and management distraction at a time when the system faces operating challenges without demonstrated sustainable improvement,” Moody’s said in a statement.
Moody’s is one of the three largest bond credit rating agencies that rank the level of risk investors face when investing in bonds issued by commercial and government entities.
SYSTEM CITES IMPROVEMENTS
EMHS members include Acadia Hospital in Bangor, Blue Hill Memorial Hospital, CA Dean Memorial Hospital in Greenville Junction, Eastern Maine Medical Center in Bangor, Inland Hospital in Waterville and Maine Coast Memorial Hospital in Ellsworth.
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EMHS spokeswoman Suzanne Spruce said the health system’s financial situation has improved since the end of the 2016 fiscal year in September.
“We are seeing steady improvement in the performance of the two newest member hospitals (Mercy Hospital, acquired in 2013, and Maine Coast Memorial Hospital, acquired in 2015),” Spruce said. “We are organizing our 1,000-plus employed providers into a single medical group, and continuing to advance our successful population health strategy.
“We are also committed to building a systemwide electronic health record, which will allow for more efficient work flow and increased quality and continuity of care. We are aware that Moody’s considered that to be a risk, however, we will successfully implement this important clinical enhancement.”
EMHS said it is working to improve the performance of its newest member hospitals, which were brought into the system after experiencing multiple years of financial distress.
NO PLANS TO BORROW
Lower credit ratings inhibit an organization’s ability to borrow money at lower interest rates, but EMHS said it isn’t planning to take on any new debt in the near term.
“Obviously, we are disappointed with Moody’s decision,” Spruce said. “The thing to keep in mind is that credit rating has no effect on care delivery, business operations, or our ongoing focus on performance improvement. Additionally, we have no plans to enter the bond market for the foreseeable future. We do look forward to revisiting our rating with Moody’s next year, when we expect to be able to demonstrate improvements to Moody’s satisfaction.”
In a statement, EMHS said that its senior leadership met with Moody’s in New York to talk about recent improvements in its financial performance and present “a solid plan for continued improvement.”
“These are challenging times for health care providers, both in Maine and throughout our nation,” it said in the statement. “EMHS’ proactive five-year strategy is both innovative and forward-thinking.”
The California Policy Center, which published the screed against SB 562 posted above, is a conservative, business-oriented think tank in based in Orange County. Thanks to Phil Caper for posting it as we need to be prepared to answer these arguments. IMO they are misleading, specious, and flat-out wrong. My objections:
ReplyDelete1. There is no evidence that significant numbers of people relocate to a state simply to take advantage of more generous health care access. It didn't happen in Massachusetts when Mitt Romney signed the Massachusetts health care reform bill after which Obamacare was modeled. And the assertion that the bill would encourage illegal immigration shows an appalling ignorance of what undocumented people have to go through to come to this country, and live under the radar once they're here. (Incidentally, such people can already get treatment at emergency rooms).
2. Residency requirements in the bill are the same as current requirements for Medicaid (or MediCal, as it's known in Califiornia. Strangely, MediCal's residency requirements have apparently not provioked a massive influx of deadbeats into the state, even though MediCal is more generous with coverage than most state Medicaid plans.
3. "Incentives for overtreatment are strong." Medicare is a poor model because it is "racked by fraudulent and other improper treatments." Atul Gawande's widely read 2008 article on doctors in McAllen, TX who have taken advantage of Medicare's fee for service payment system to shamelessly soak the federal government makes a persuasive case for putting restrainst on what procedures providers can be paid for. On the other hand, Steve Kemble in Hawaii has argued that the downside of fee for service has been grossly exaggerated.It certainly has been less damaging to Medicare's bottom line than the diversion of Medicare dollars to private insurance (around 15% more expensive) under Part C, and the blatant handouts to the drug houses under Part D. In any case, whatever the waste, Medicare is still far cheaper and more efficient than private plans.
4. "Kaiser would be obliged to become a fee for service provider." Not true. Kaiser could retain its current system of charging a fixed yearly per patient fee (capitation). Only the money would be paid by the state, not the patient.
4. "Kaiser is not-for-profit. Neither is Blue Shield." Bunk. They compete with for-profit insurers for market shares, and behave accordingly. In the real world, their "non-profit" status serves mainly to exempt them from taxes.
5. Article questions whether California will be able to leverage federal funds from a GOP-controlled Congress. Maybe not, federal lasw does authorize it, Indiana has already gotten waivers for its own Medicaid plan, and in any case a GOP-lewd Congress seems poised to slash Medicaid funding regardless of whether SB 562 passes. If it does, California will be obliged to make the most efficient use of the funds still available, or face catastrophic cutbacks to health care access. Under such cirtcumstances, private insurance becomes an even bigger liability for the state. This is an argument in favor of Lara's bill, not against it.
6. Notwithstanding the article's claim that the bill contains no cost controls, it does set up an administrative body to work out procedures for determining what is reimbursed, and how much. Administrative rules do not belong in a piece of enabling legislation; if they did no legislation would ever pass. The federal Center for Medicare and Medicaid Services makes these decisions where federal health care programs are concerned; they are not written into the federal law passed in 1965.
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