The Conservative Case for Universal Healthcare
by Chase Madar - The American Conservative - July 25, 2017
Don’t tell anyone, but American conservatives will soon be embracing single-payer healthcare, or some other form of socialized healthcare.
Yes, that’s a bold claim given that a GOP-controlled Congress and President are poised to un-socialize a great deal of healthcare, and may even pull it off. But within five years, plenty of Republicans will be loudly supporting or quietly assenting to universal Medicare.
And that’s a good thing, because socializing healthcare is the only demonstrably effective way to control costs and cover everyone. It results in a healthier country and it saves a ton of money.
That may seem offensively counterintuitive. It’s generally assumed that universal healthcare will by definition cost more.
In fact, in every first-world nation that has socialized medicine–whether it be a heavily regulated multi-insurer system like Germany, single-payer like Canada, or a purely socialized system like the United Kingdom–-it costs less. A lot, lot less, in fact: While healthcare eats up nearly 18 percent of U.S. GDP, for other nations, from Australia and Canada to Germany and Japan, the figure hovers around 11 percent. (It’s no wonder that smarter capitalists like Charlie Munger of Berkshire Hathaway are bemoaning the drag on U.S. firm competitiveness from high healthcare costs.) Nor are healthcare results in America anything to brag about: lower life expectancy, higher infant mortality and poor scores on a wide range of important public health indicators.
Why does socialized healthcare cost less? Getting rid of private insurers, which suck up a lot money without adding any value, would result in a huge savings, as much as 15 percent by one academic estimate published in the American Journal of Public Health. When the government flexing its monopsony muscle as the overwhelmingly largest buyer of medical services, drugs and technology, it would also lower prices-–that’s what happens in nearly every other country.
So while it’s a commonly progressive meme to contrast the national expenditure of one F-35 with our inability to “afford” single-payer healthcare–and I hesitate to say this lest word get out to our neocon friends–there is no need for a tradeoff. If we switched to single payer or another form of socialized medicine, we would actually have more money to spend on even more useless military hardware.
The barrier to universal healthcare is not economic but political. Is profligate spending on health care really a conservative value? And what kind of market incentives are working anyway–it’s an odd kind of market transaction in which the buyer is stopped from negotiating the price, but that is exactly what Medicare Part D statutorily requires: The government is not allowed to haggle the prices of prescription drugs with major pharmaceutical companies, unlike in nearly every other rich country. (Both Hillary Clinton and Donald Trump pledged to end this masochism, but the 45th president has so far done nothing, and U.S. prescription drug prices remain the highest in the world.) Does anyone seriously think “medical savings accounts” with their obnoxious complexity and added paperwork are the right answer, and not some neoliberal joke?
The objections to socialized healthcare crumble upon impact with the reality. One beloved piece of folklore is that once people are given free healthcare they’ll abuse it by going on weird medical joyrides, just because they can, or simply let themselves go because they’ll have free doctor visits. I hate to ruin this gloating fantasy of lumpenproletariat irresponsibility, but people need take an honest look at the various health crises in the United States compared to other OECD (Organisation for Economic Cooperation and Development) countries. If readily available healthcare turns people hedonistic yahoos, why does Germany have less lethal drug overdoses than the U.S. Why does Canada have less obesity and type II diabetes? Why does the Netherlands have less teen pregnancy and less HIV? The evidence is appallingly clear: Among first-world countries, the U.S. is a public health disaster zone. We have reached the point where the rationalist santería of economistic incentives in our healthcare policies have nothing to do with people as they actually are.
If socialized medicine could be in conformity with conservative principles, what about Republican principles? This may seem a nonstarter given the pious market Calvinism of Paul Ryan and Congressmen like Reps. Scott Perry (R-Pa.) and Mo Brooks (R-Ala.), who seem opposed to the very idea of health insurance of any kind at all. But their fanaticism is surprisingly unpopular in the U.S. According to recent polling, less than 25 percent of Americans approve of the recent GOP healthcare bills. Other polls show even lower numbers. These Republicans are also profoundly out of step with conservative parties in the rest of the world.
Strange as it may seem to American Right, $600 EpiPens are not the sought-after goal of conservatives in other countries. In Canada, the single-payer healthcare system is such a part of national identity that even hard-right insurgents like Stockwell Day have enthusiastically pledged to maintain it. None of these systems are perfect, and all are subject to constant adjustment, but they do offer a better set of problems–the most any mature nation can ask for–than what we have in the U.S.
And virtually no one looks at our expensive American mess as a model.
I recently spoke with one German policy intellectual, Nico Lange, who runs the New York outpost of the German Christian Democrats’ main think tank, the Konrad Adenauer Stiftung, to get his thoughts on both American and German healthcare. Is socialized medicine the entering wedge of fascism and/or Stalinism? Are Germans less free than Americans because they all have healthcare (through a heavily regulated multi-payer system), and pay a hell of a lot less (11.3 percent of GDP) for it?
Mr. Lange paused, and took an audible breath; I felt like I had put him in the awkward spot of inviting him over and asking for his honest opinion of the drapes and upholstery. “Yes,” he said, “we are less free but security versus freedom is a classic balance! National healthcare makes for a more stable society, it’s a basic service that needs to be provided to secure an equal chance for living standards all over the country.” Even as Mr. Lange delineated the conservative pedigree of socialized medicine in Germany–“You can certainly argue that Bismarck was a conservative in founding this system”–I had a hard time imagining many Democrats, let alone any Republican, making such arguments.
Indeed, the official GOP stance is perhaps best described as Shkrelism than conservatism, after the weasel-faced pharma entrepreneur Martin Shkreli, who infamously jacked up the price of one lifesaving drug and is now being prosecuted for fraud. (Though in fairness, this type of bloodsucking awfulness is quite bipartisan: Heather Bresch, CEO of Mylan corporation, which jacked up the price of EpiPens from $100 to $600, is the daughter of Senator Joe Manchin (D-WV), who defended his daughter’s choice.)
But GOP healthcare politics are at the moment spectacularly incoherent. Many GOP voters have told opinion polls that they hate Obamacare, but like the Affordable Care Act. And as the GOP healthcare bill continues to be massively unpopular, Donald Trump has lavished praise on Australia’s healthcare system (socialized, and eating up only 9.4 percent of the GDP there). Even in the GOP, this is where the votes are: Trump’s move to the center on questions of social insurance–Medicare, Medicaid, Social Security–was a big part of his appeal in the primaries. The rising alt-Right, not to hold them up as any moral authority, don’t seem to have any problem with universal Medicare either.
It will fall on “reform conservatives” to convince themselves and others that single-payer or some kind of universal care is perfectly keeping with conservative principles, and, for the reasons outlined above, it’s really not much of a stretch. Lest this sound outlandish, consider how fully liberals have convinced themselves that the Affordable Care Act–a plan hatched at the Heritage Foundation for heaven’s sake, and first implemented by a Republican governor–is the every essence of liberal progressivism.
Trump’s candidly favorable view of Australian-style socialized healthcare is less likely a blip than the future of the GOP. Republican governors who actually have to govern, like Brian Sandoval and John Kasich, and media personalities like Joe Scarborough, and the Rock, will be soon talking up single-payer out of both fiscal probity, communitarian decency, and the in-your-face evidence that, ideology aside, this is what works. Even the Harvard Business Review is now giving single-payer favorable coverage. Sean Hannity and his angry brigade may be foaming at the mouth this week about the GOP failure to disembowel Obamacare, but Sean’s a sufficiently prehensile fellow to grasp at single-payer if it seems opportune–just look at his about-face on WikiLeaks. And though that opportunity has not arisen yet, check again in two years.
The real obstacle may be the Democrats. As Max Fine, last surviving member of John F. Kennedy’s Medicare task force, recently told the Intercept, “Single payer is the only real answer and some day I believe the Republicans will leap ahead of the Democrats and lead in its enactment,” he speculated, “just as did Bismarck in Germany and David Lloyd George and Churchill in the UK.” For now, an invigorating civil war is raging within the Democrats with the National Nurses Union, the savvy practitioner-wonks of the Physicians for a National Health Program, and thousands of everyday Americans shouting at their congressional reps at town hall meetings are clamoring for single-payer against the party’s donor base of horrified Big Pharma executives and affluent doctors. In a few years there might even be a left-right pincers movement against the neolib/neocon middle, whose unlovable professional-class technocrats are the main source of resistance to single payer.
I don’t want to oversell the friction-free smoothness of the GOP’s conversion to socialized healthcare. Our funny country will always have a cohort of InfoWars ooga-boogas, embittered anesthesiologists and Hayekian fundies for whom universal healthcare is a totalitarian jackboot. (But, and not to be a jerk, it’s worth remembering that Hayek himself supported the socialized healthcare of Western Europe in one of his most reasonable passages from the Road to Serfdom.)
So even if there is some banshee GOP resistance at first, universal Medicare will swiftly become about as controversial as our government-run fire departments. Such, after all, was the trajectory of Medicare half a century ago. You read it here first, people: Within five years, the American Right will happily embrace socialized medicine.
Chase Madar is an attorney in New York and the author of The Passion of Bradley Manning: The Story Behind the Wikileaks Whistleblower.
The following article illustrates an important point about the direction of health care policy in the US. While we often focus on the overall costs of healthcare and financial protection from the effects of its high costs ("insurance" coverage), we often neglect an even more pernicious problem - the transformation of American health care from its traditional focus on its mission of preventing, diagnosing and treating disease to one of extracting wealth from those who purchase healthcare goods and services to those who sell them, regardless of the effects on the quality of care. That is the true corruption of the American health care system.
Pharmacy middlemen steer some patients to riskier drugs
The MacMillans Announce the Engagement of Their Daughter to a Man with Really Fantastic Health Insurance
by Briana Haynie - The New Yorker - July 2, 2018
Mr. and Mrs. MacMillan, of Hartford, Connecticut, are pleased to announce the engagement of their daughter, Caroline MacMillan, to a man with an insurance plan that’s accepted by ninety seven per cent of all doctors.
The bride was born in Danbury, Connecticut, and graduated magna cum laude from Quinnipiac University, in 2015. Ms. MacMillan’s fiancé has a monthly insurance premium of two hundred dollars that will only increase to two hundred and fifty-three dollars when Ms. MacMillan joins his plan.
The bride, who is twenty-five, will soon be aging out of her parents’ mediocre insurance plan, so there’s really no better time to be marrying a man with full dental and vision.
The groom, with the aforementioned great insurance, comes from a long line of well-insured men and women who have lived full and exciting lives free of the burdens of self-financed health care. When the groom’s father broke his hip, in 2014, and needed a replacement, their insurance covered all of the medical bills and even sent a get-well-soon card. His grandmother boasts the distinction of being the recipient of the first insured mammogram.
The groom’s parents, a man who has had Lasik eye surgery and a woman with no cavities, are elated to add a daughter to their well-insured lineage.
The bride’s parents are thrilled that their daughter found a man despite her noticeably crooked teeth, a result of them not being able to afford orthodontia. They are also ecstatic that she will finally have insurance despite preëxisting conditions, including generalized anxiety disorder, an allergy to peanuts, and the ability to bear children. And they really can’t believe that all of their future grandchildren will receive a full dose of the H.P.V. vaccine.
The wedding will take place on the banks of the Hudson River. The bride and groom will go barefoot, despite the presence of various sharp rocks and rusty nails, because the groom’s insurance fully covers all emergency-room visits.
Through the beauty of matrimony, Ms. MacMillan will be gaining an insurance plan that will allow her to continue seeing Dr. Gary Mound, her longtime primary-care physician and the officiant of the wedding.
The bride will also gain ten-dollar co-pays, five-dollar fees for all medications, a flexible spending account with no rollover limit, fifty free therapy sessions a year, chiropractic visits, plus limitless ionic foot baths and acupuncture.
Ms. MacMillan and the groom with the most amazing insurance plan known to man will honeymoon in Nepal right after receiving free his-and-hers typhoid shots.
by Robert Pear - NYT - July 7, 2018
WASHINGTON — The Trump administration said Saturday that it was suspending a program that pays billions of dollars to insurers to stabilize health insurance markets under the Affordable Care Act, a freeze that could increase uncertainty in the markets and drive up premiums this fall.
Many insurers that enroll large numbers of unhealthy people depend on the “risk adjustment” payments, which are intended to reduce the incentives for insurers to seek out healthy consumers and shun those with chronic illnesses and other pre-existing conditions.
“Any action to stop disbursements under the risk adjustment program will significantly increase 2019 premiums for millions of individuals and small-business owners, and could result in far fewer health plan choices,” said Justine G. Handelman, a senior vice president of the Blue Cross and Blue Shield Association. “It will undermine Americans’ access to affordable care, particularly for those who need medical care the most.”
Trump administration officials said they decided to suspend payments under the program because of a ruling in February in Federal District Court in New Mexico. The judge tossed out the formula used to calculate payments, finding that it was flawed.
“We were disappointed by the court’s recent ruling,” said Seema Verma, the administrator of the Centers for Medicare and Medicaid Services. “As a result of this litigation, billions of dollars in risk adjustment payments and collections are now on hold.”
Ms. Verma said her agency had asked the court to reconsider its ruling and was hoping for a prompt resolution of the issue, to “prevent more adverse impacts on Americans who receive their insurance in the individual and small group markets.”
But supporters of the Affordable Care Act said the move was the latest example of the Trump White House’s efforts to undermine the health law.
“The Trump administration just keeps pushing their destructive repeal-and-sabotage agenda, no matter the cost to the American people,” said Brad Woodhouse, the director of Protect Our Care, an advocacy group that supports the health law. “Following through with this latest act of sabotage could raise rates for all consumers even more.”
Some insurers expressed alarm at the administration’s decision, which comes just as insurance companies are developing premiums for 2019 and states are reviewing proposed rates.
“We are very discouraged by the new market disruption brought about by the decision to freeze risk adjustment payments,” said Matt Eyles, the president and chief executive of America’s Health Insurance Plans, a trade group for insurers.
He predicted that costs to taxpayers would rise because the government provides subsidies that increase along with premiums. Those premium subsidies, for low- and moderate-income people, will continue.
The decision in February, by Judge James O. Browning, voided the formula used by the federal government to calculate risk adjustment payments each year from 2014 to 2018. The amount at stake just for 2017 is $10.4 billion. The payments shuffle money among insurers, from those with healthier customers to those with less healthy members who have a higher risk of using costly medical care.
Trump administration officials said they were caught between two conflicting court rulings. The New Mexico ruling prevents the government from making further collections or payments under the risk adjustment program using the current formula, they said. But, they added, in January a federal district judge in Massachusetts upheld the method used by the government to calculate risk adjustment payments.
While insurers warned of market turmoil if the payments were withheld, Dr. Martin E. Hickey, the founder of New Mexico Health Connections, the company that filed the lawsuit in that state, said the court ruling there would benefit consumers.
“The risk adjustment formula was extremely biased in favor of large, established insurers and discriminated against new and small insurers, including co-ops like ours,” Dr. Hickey said in an interview on Saturday.
“People spin the administration’s decision as Trump trying to do harm, but it’s exactly the opposite,” Dr. Hickey said. “It will allow more companies to get into the insurance market. That will increase competition, and competition will help keep prices down.”
Risk adjustment payments are based, in part, on the health status of consumers. When the risk adjustment program began in 2014, some large insurers had a potential advantage: They knew the medical and claims history of many consumers because they had insured them in the past.
Judge Browning said the payment formula was flawed because federal officials “assumed erroneously” that collections and payments under the risk adjustment program had to offset each other so there would be no new cost to the federal government.
That might have been a rational policy choice, he said, but the government never articulated its reasons.
The Trump administration blamed President Barack Obama on Saturday, saying, “This aspect of the risk adjustment methodology was promulgated as part of a regulation first issued by the Obama administration in 2013.”
As health insurers across the country begin filing their proposed rates for 2019, one thing is clear: The market created by the Affordable Care Act shows no signs of imminent collapse in spite of the continuing threats by Republicans to destroy it.
In fact, while President Trump may insist that the law has been “essentially gutted,”the A.C.A. market appears to be more robust than ever, according to insurance executives and analysts. A few states are likely to see a steep spike in prices next year, but many are reporting much more modest increases. Insurers don’t appear to be abandoning markets altogether. In contrast to last year, regulators are not grappling with the prospect of so-called “bare” counties, where no carrier is willing to sell A.C.A. policies in a given area.
“The market is in a better position now than it has ever been since the exchanges have opened,” said Deep Banerjee, who follows insurers for S & P Global Ratings. The companies first began selling policies in the state exchanges, or marketplaces, five years ago. After years of losses, the insurers are now generally making money.
With roughly a third of states releasing information, the insurers’ rate requests vary widely, according to an analysis by the Kaiser Family Foundation. In Maryland, companies are seeking increases averaging 30 percent. A midlevel policy in Baltimore could cost $622 a month, roughly a third higher than the average of the other states reporting to date.
In Minnesota, which created a reinsurance program to help pay for customers’ expensive medical conditions, carriers are actually seeking lower premiums. A midlevel policy in Minneapolis is priced at $302 a month.
The political and legal turmoil in the market is likely to persist, and final premiums will not be established for months. States are still working out details of some of their proposals to stabilize their own marketplaces. Those could be blocked by the federal government or a federal court, as in the case of last Friday’s decision regarding the work requirement sought by Kentucky for its Medicaid program.
“We will start seeing more variation in the coming years, not just in premiums, but what rules the states are enforcing,” said Cynthia Cox, a policy expert at the Kaiser foundation.
Insurers are also watching the developments in the Texas lawsuit brought by Republican attorneys general. The Justice Department recently sided with the Republican states in arguing that the provisions protecting people with existing medical conditions are unconstitutional, which would upend the market entirely.
But for now, insurers are comfortable with the market as it has come to exist even with less federal support for the law. “The business has stabilized and we’re confident,” said Brian Lobley, an executive with Independence Blue Cross, which offers plans in Pennsylvania and New Jersey. Insurers in Pennsylvania are seeking average increases of just under 5 percent, according to the state insurance department. Other states, including Florida, Indiana, Michigan and Ohio, could also see single-digit increases.
Still, steadily higher prices are driving away more people who cannot afford those rising costs.
People whose income levels are low enough to qualify for federal tax credits are largely insulated from price hikes because the credits they receive increase to cover the higher premiums. Individuals can use the credits to help pay for their monthly premiums and, in some cases, are able to cover the entire cost of a plan.
But the number of people buying A.C.A. plans at full price dropped by roughly 20 percent from 2016 to 2017, according to new federal data. While some people may have qualified for subsidies for the first time because of the higher prices, about 1 million people appear to have stopped buying coverage.
Read more about Obamacare enrollment.
Premiums soared an average of about 30 percent in 2018 for those who did not qualify for a federal subsidy. Overall enrollment has declined from its peak in 2016, according to federal data released Monday, with 10.6 million customers buying plans in the state marketplaces for 2018.
Of those, the overwhelming majority — 9.2 million — qualify for some federal assistance. “The premium tax credits have made the market extremely resilient,” said Sabrina Corlette, a research professor at Georgetown University.
The field of fewer customers has not scared off the surviving companies. Some insurers, ranging from Centene, the market’s largest player with 1.6 million customers, to Oscar Health, the venture-backed outfit that struggled in the early years, are expanding next year. More than a dozen carriers are entering new markets.
“We believe the market is going to be a largely stable market,” said Mario Schlosser, the chief executive of Oscar, which has watched its profitability improve. The company wants to nearly double the number of places where it sells policies, including entering three new states: Arizona, Florida and Michigan.
Nevertheless, Republican efforts to unwind the law are having some effect. The tax overhaul law eliminated the tax penalty that people face if they refuse coverage, doing away with the so-called individual mandate that encourages healthier people to enroll. The administration has also been pushing the adoption of much cheaper and flimsier policies that compete with A.C.A. plans by issuing new rules on association plans.
“I have to give a fair amount of credit to the Trump administration,” said Mike Kreidler, the Washington state insurance commissioner and a proponent of the federal law. In Washington state, the insurers want to raise premiums by an average of 19 percent after hiking prices by 36 percent for 2018. Without the administration’s actions, he said, rate increases would have been in the single digits for 2019.
In New York state, about half of the 24 percent increase being sought by insurers is because of the removal of the mandate. Insurers think fewer healthy people will enroll without a penalty in place, leading to sharply higher premiums because the remaining pool is sicker.
Most Americans are not affected by the travails of the individual market. In the much larger employer-based market, where some 150 million people get their insurance, companies generally pay the bulk of the premium. Underlying medical costs are forecast to go up around 6 percent next year, in line with recent increases, according to PwC’s Health Research Institute.
While there is some debate, the percentage of people who are uninsured appears not to have grown since Mr. Trump took office: it’s been about 9 percent since 2015.
Depending on where people live, their choice of plans and the prices they pay will differ dramatically next year. “The experience will be a hodgepodge across the states,” said Chet Burrell, the former chief executive of CareFirst, the Blue Cross plan that sells A.C.A. policies in Maryland and Virginia.
Some states, like Minnesota, where some carriers propose to drop prices by as much as 12 percent, are setting up a reinsurance program like the one that had been discussed but not adopted on a federal level. Maryland is awaiting federal approval for a similar program that could significantly lower prices in the state.
In Washington state, lawmakers were unsuccessful in their attempts to create a reinsurance program, said Mr. Kreidler, the regulator. “We ran into the same problem some other states did — it’s tough coming up with the money,” he said.
Other states may restrict the sale of policies that compete with the A.C.A. plans or develop their own version of the individual mandate.
But insurers are increasingly comfortable with the current state of the market. In Iowa, Medica was the only remaining insurer in 2018 after the dramatic exit by the state’s Blue Cross plan. The insurer increased its prices there by nearly 60 percent this year. For next year, it is contemplating increases in the single digits, and Wellmark, the Blue Cross plan, said it would get back into the Iowa market in 2019after talking with state officials.
Citing the relative stability in the environment, Medica also plans to expand into two more states in 2019. It says it is able to factor in the continued uncertainty over the influx of new competing plans. “We have had to become pretty nimble and pretty flexible,” said Geoff Bartsh, an executive with Medica.
Most insurers think the Republicans will not be successful in their legal efforts to undo the law, and they are holding off on making any dramatic moves. But that could change if the courts rule in favor of the Trump administration and the Republican attorneys general. “The big game changer would be the lawsuit in Texas,” Mr. Bartsh said.
In spite of the market’s rockiness, insurers are discovering their customers were loyal. “Last time, they tried everything,” said Michael Neidorff, the chief executive for Centene, including eliminating the subsidies aimed at reducing people’s out-of-pocket costs if they were low income and slashing the outreach efforts. But Mr. Neidorff said the vast majority of people remained enrolled. “People want insurance,” he said.
Those who can afford coverage are also remaining because they have little choice. “It’s a very price inelastic set of enrollees,” said Caroline Pearson, a senior fellow at NORC, a research group at the University of Chicago, who says insurers have become less concerned about the price increases.
They are resigned to offer coverage in a smaller but stable market, Ms. Pearson said. “They are a very hardy bunch,” she said. “They have been through a lot.”
Vermont to Adopt Rules to Regulate New Healthcare PlansBy Davie Jordon - AP - US News - July 4, 2018
MONTPELIER, Vt. (AP) — The Vermont Department of Financial Regulation will file emergency regulations in response to a new health insurance option from Republican President Trump's administration over concerns the plans may not be financially solvent and could leave consumers vulnerable to fraud.
The U.S. Department of Labor issued their final rules for "association health plans" last month, which can be offered beginning in September. Vermont regulators are filing emergency rulemaking to ensure regulations will be in place by this fall.
Commissioner of Financial Regulation Michael Pieciak said previous similar plans were "poorly run" and many were fraudulent. Under Vermont law the finance commissioner can adopt rules that promote stability in Vermont's insurance market.
New plans are designed to lower premiums for small businesses and self-employed people, but are likely to offer fewer benefits.