Health Care Reform Articles - August 1, 2019

Kamala Harris Sets Up Debate Showdown on Health Care With New Plan

by Abby Goodnough and Astead W. Hermon - NYT - July 29, 2019

Senator Kamala Harris of California, who is increasingly seeking to carve out an ideological lane separate from the most progressive Democrats running for president, laid out a new plan Monday for providing Medicare for all Americans, with a twist that stops short of the complete overhaul of the health insurance system that Senator Bernie Sanders of Vermont has proposed.
Ms. Harris’s announcement comes as the Democratic candidates are preparing for a fresh round of debates this week, and as she faces mounting pressure to clarify her stance on the issue after repeated missteps. It also comes as fellow candidates, such as Mr. Sanders and former Vice President Joseph R. Biden Jr., have sparred over health care in recent weeks.
The issue has become a litmus test among the 2020 Democrats, separating the candidates of the progressive left, who want to move rapidly toward a single-payer health care system, and the more moderate contenders, who favor other ways of expanding coverage and lowering costs.
Ms. Harris’s proposal seeks to straddle both camps, using the “Medicare for all” mantra as a long-term target while also seeking to keep a significant role for private insurers — which Mr. Sanders’s plan would eliminate.

Instead of completely replacing private coverage with a government-run, single-payer system based on traditional Medicare, Ms. Harris would allow people to choose plans modeled on Medicare Advantage, which would be run not by the government but by private insurers. More than one-third of the Medicare population already chooses Medicare Advantage, which offers extra benefits and limits out-of-pocket costs but is strict about which doctors and hospitals enrollees can use.
Her plan would also allow people to choose a somewhat expanded version of traditional, government-run Medicare. But by preserving a major role for private insurers — and calling for a 10-year phase-in period instead of the four-year transition that Mr. Sanders envisions — it could go a long way toward neutralizing fierce opposition from insurance companies, many of which have profited handsomely from Medicare Advantage plans.
“Essentially, we would allow private insurance to offer a plan in the Medicare system, but they will be subject to strict requirements to ensure it lowers costs and expands services,” Ms. Harris wrote in a summary of the plan that her campaign said would be posted Monday on Medium. “If they want to play by our rules, they can be in the system. If not, they have to get out.”

At the Democratic debate this week in Detroit, Ms. Harris is likely to face questions about her previous statements on health care, in which she has oscillated between supporting Mr. Sanders’s more robust proposal and rejecting its most controversial parts, like tax increases on some middle-class families.

Ms. Harris’s advisers said she wanted a plan that more closely reflected her values to lay out on the debate stage. But while her proposal draws specific contrasts with Mr. Sanders’s, the two candidates will debate on separate nights this week. Both are in the tier of candidates below Mr. Biden in current polling, along with Senator Elizabeth Warren of Massachusetts.

Ms. Harris’s plan also appears intended to put to rest confusion over her past statements on abolishing private health insurance. At a CNN town-hall-style event in January, Ms. Harris responded to a question about private insurance by saying, “Let’s eliminate all of that.” And at the first debate last month, Ms. Harris raised her hand when asked if she favored getting rid of private insurance. In both cases, she attempted to clarify her position after the events.
But Ms. Harris’s proposal still leaves open questions, including how the longer transition period would play out. During those 10 years, newborns and the uninsured would be automatically enrolled into a “new and improved” Medicare system, according to the Harris campaign, and all Americans could buy into the public program.
Ian Sams, a spokesman for Ms. Harris, said in an email that her plan, like Mr. Sanders’s, would limit everyone’s annual out-of-pocket costs to $200.

Bernie Sanders led a bus trip to Canada with people with diabetes to highlight the steep cost of insulin in the U.S.

Mr. Sanders’s plan, by comparison, would allow everyone 55 and older to join Medicare in the first year, and would move everyone into Medicare by the fourth year.

Ms. Harris was also eager to draw a contrast with Mr. Sanders over the extent to which they would ask the middle class to help pay for their plans. Mr. Sanders has raised the possibility of imposing premiums equaling 4 percent of people’s income after the first $29,000 for a family of four. Critics have assailed that provision as politically unpalatable, but Mr. Sanders has said that families’ overall health costs would be significantly reduced.
Ms. Harris, on the other hand, would “exempt households making below $100,000, along with a higher income threshold for middle-class families living in high-cost areas,” according to her Medium post.
In the post, Ms. Harris made her version of Medicare for all sound similar to Mr. Sanders’s in terms of benefits. She said it would cover “all medically necessary services, including emergency room visits, doctor visits, vision, dental, hearing aids, mental health and substance use disorder treatment, and comprehensive reproductive health care services.”
Ms. Harris’s 10-year runway would “give all doctors time to get into the system, and provide a common-sense path for employers, employees, the underinsured, and others on federally-designated programs, such as Medicaid or the Affordable Care Act exchanges, to transition,” she wrote.
Mr. Sams said both Medicaid and the exchanges would be eliminated under Ms. Harris’s plan, but older Americans would continue to have the same coverage options they get now.
Like Mr. Sanders, Ms. Harris did not provide specific details of how she would pay for her plan but said she liked several of his ideas, especially imposing higher taxes on corporations and the top 1 percent of earners. She also said she liked the idea of modest increases in employer taxes to help pay for her plan; Mr. Sanders has suggested a 7.5 percent payroll tax on employers.
Mr. Sanders ran on the idea of a single-payer system in his 2016 presidential campaign, and his proposal has largely set the tone of the health care debate this time around, forcing rivals to establish their positions relative to his.

Ms. Warren, another liberal Democrat who co-sponsored Mr. Sanders’s bill, used the first debate as a moment to leave no doubt that she stood with him. “I’m with Bernie on Medicare for all,” she said.
Mr. Biden has moved in the opposite direction. In recent weeks, he has ramped up his criticisms of Medicare for all, seeking to contrast himself with the senators looking to supplant him atop the primary polls.
His plan would model itself after the Affordable Care Act and allow anyone to sign up for a new “public option,” or government-run health plan like Medicare. Most of the other Democratic candidates have also called for keeping private insurance while offering some kind of public option.

We surveyed the candidates to find out where they stood on health care.

Mr. Biden has even veered into language that mirrors attacks Republicans have used to disparage the idea of a single-payer system. “Come on, what is this, a fantasy world?” he said at a campaign stop in Michigan, referring to Medicare for all. (He and Ms. Harris will stand next to each other on the debate stage on Wednesday; Mr. Sanders and Ms. Warren will be onstage Tuesday.)
One criticism of Medicare Advantage plans is that the insurance companies that offer them manage to make big profits by luring the younger, healthier segment of the Medicare population and by doing things like requiring prior authorization for certain care to control costs.
Seemingly nodding to the concern that Medicare Advantage plans have earned some insurers fat profits, Ms. Harris said she would be tough on companies that wanted to offer such plans under her system, with stricter consumer protection rules than exist today. She even raised the possibility that insurers would be “reimbursed less than what the Medicare plan will cost to operate, to ensure they are delivering meaningful value and unable to profit off gaming consumers or the government.”

How that would work — and how many insurance companies would agree to be reimbursed less than what their plans cost to operate — remained unclear.
“My guess is it’s a nod to the fact that private plans in Medicare Advantage today are arguably overpaid for the services they deliver,” said Sabrina Corlette, a research professor at Georgetown University’s Center on Health Insurance Reforms.
Ms. Corlette was on a list of analysts the Harris campaign provided to reporters seeking reaction to the plan, along with several former Obama administration officials and others. She said that while she was not endorsing the plan or Ms. Harris, “I think it’s a great step forward that this campaign is putting some deeper policy thought into how to execute the senator’s vision and what it will take to get there.”
Ms. Corlette said she thought a 10-year transition period was much more realistic than the four-year phase-in proposed by Mr. Sanders. But she acknowledged that drawing out the transition to Medicare for all would raise the chances that it would never happen, given the number of presidential and congressional elections that would take place over that time.
“That is a significant issue,” she said. “On the other hand, to try to rush this I think raises more risks than benefits.”
https://www.nytimes.com/2019/07/29/us/politics/kamala-harris-medicare-for-all.html

Senator Harris: You really need to rethink your plan to put private insurers in charge of Medicare 

by Wendell Potter - Tarbell.org - July 31, 2019

If Sen. Kamala Harris and her advisors consulted with people who know what drives decision-making at big health insurance companies, she surely would never have put privately operated Medicare Advantage plans at the center of her health care reform proposal this week. 
They clearly didn’t take the time to look at even recent news reports, much less learn what has happened in the past when the government has tried to do what she is proposing. 
In her Medium post, Harris said that her plan would allow private insurers to offer Medicare plans but that they would “adhere to strict Medicare requirements on costs and benefits.”
She went on to write that the Medicare Advantage plans “will be held to stricter consumer protection standards than they are today, such as getting reimbursed less than what the Medicare plan will cost to operate, to ensure that they are delivering meaningful value and unable to profit off of gaming consumers or the government…
“Essentially, we would allow private insurance to offer a plan in the Medicare system, but they will be subject to strict requirements to ensure it lowers costs and expands services. If they want to play by our rules, they can be in the system. If not, they have to get out.”
And get out they would, leaving millions of Americans scrambling, as they did nearly two decades ago when I was still in my job as head of communications at Cigna. 
During 1990s when the Clintons were in the White House, privately operated Medicare managed care plans grew at a fast clip, from about 2 million in 1993 to more than 6 million in 1998, according to the U.S. Government Accountability Office. But big problems began to emerge.
For one thing, as the GAO noted in a September 2000 report, insurers had little interest in marketing their plans to people in rural areas. For another, the plans had little interest in covering people who had health problems. Numerous studies found that private Medicare plans “tended to attract beneficiaries with lower-than-average health costs.” That’s because insurance companies implemented sales and marketing strategies that targeted the healthiest people in a given market. 
As a result, according to the GAO, the government “was not realizing the expected savings” that advocates private Medicare plans had promised. In fact, it became clear that the government was significantly overpaying insurance companies that operated the private plans. 
So in 1997, Congress passed legislation to both encourage the wider availability of private Medicare plans (then called Medicare-Choice) and to slow the growth of payments to insurers.  In other words, to do exactly what Harris is now proposing. 
Insurers responded by heading for the exits. 
As the GAO reported, nearly 100 plans “either terminated their contracts and fully withdrew from the program or partially withdrew by reducing the geographic areas they served for the 1999 contract year.” It got even worse the next year: 118 plans announced they would terminate their contracts or reduce service areas. More than 1.3 million Americans were affected. Many found that there were no private plans available to them. Many others saw their benefits cut and their premiums go up. 
Private ensures cried foul, as you can imagine. Managed Care Outlook, a trade publication, reported in July 1999 that insurance companies claimed the budget cuts mandated by the 1997 law made it impossible for them to operate profitably in many markets. 
Cigna was one of many insurers to bail out of the Medicare+Choice program, and my team was responsible for announcing that decision. 
On Friday afternoon, June 2, 2000, we sent out a press release saying the company was abandoning all but two of its Medicare+Choice markets. Among the many markets affected was Los Angeles. As the Los Angeles Times reported the next day, Cigna’s decision meant that more than 100,000 seniors across the country would have to find new health insurance. The story went on to note that, “health plans have dumped 750,000 Medicare beneficiaries from their rolls since 1998.” 
Among those quoted was Linda Bergthold, a Santa Clara-based health care analysts and consultant. “For the lowest tier of elderly, this is really a dramatic problem,” she said. “It’s extremely disruptive and difficult.”
Also quoted was Carolyn Boyer, a Cigna health plan member who the Times said was battling an aggressive form of breast cancer. “We’re just devastated,” she said. 
Then there was this dramatic quote from the health insurance industry’s top lobbyist at the time, Karen Ignani: 
“The program is in free fall. We’re in the middle of a real crisis.”
At the center of that crisis was Wall Street. The reason the big, for-profit insurers fled the Medicare+Choice program was because their investors and Wall Street financial analysts would not tolerate the slimmer profit margins caused by the 1997 law.
When George W. Bush took office in 2001, Republicans, bent on privatizing Medicare, set out to bring the program back to life. Soon after the GOP took control of both the House and Senate in 2003, Congress passed The Medicare Prescription Drug, Improvement, and Modernization Act, major portions of which were written by lobbyists for drug and insurance companies. That law changed the name of the program from Medicare+Choice to Medicare Advantage—and all but assured that it would become a major new cash cow for health insurers. 
Cigna and most of the other companies rushed back in, largely because they were now able to game the system to their advantage (pun intended.)
Medicare Advantage has become so lucrative than many of the big insurers now take in more revenue from the government than from the private sector. 
Insurers have learned to game the system so well, in fact, they federal officials acknowledge insurers have overbilled the government more than $30 billion over just last three years alone. And that is after the passage of the Affordable Care Act, which at least reduced some of the overbilling. It was much worse before the ACA.
Among the few reporters who have reported on this is Fred Schulte, a former colleague of mine at the Center for Public Integrity who now writes for Kaiser Health News.
I encourage Sen. Harris and her advisors to check out Fred’s reporting over the past several years. (Google his name and Medicare Advantage and you’ll see reporting that every American, certainly every presidential candidate and every member of Congress, should read.) If they had only read the headline of the story Fred and fellow reporter Lauren Weber wrote just two weeks ago, they surely would not have made Medicare Advantage the centerpiece of her new scheme to keep private insurers in control of our health care system. 
To make it easy for you, Sen. Harris, here’s their story: 
Insurers Running Medicare Advantage Plans Overbill Taxpayers By Billions As Feds Struggle To Stop It

 

https://tarbell.org/2019/07/senator-harris-you-really-need-to-rethink-your-plan-to-put-private-insurers-in-charge-of-medicare/

 Is My Health Plan a Cadillac? Why Are We Comparing Health Insurance to Cars?

by Margot Sanger-Katz - NYT - July 20, 2019

The House voted to repeal the Cadillac tax on Wednesday, aiming to make permanent what previous Congresses have merely postponed. The tax was a provision of the Affordable Care Act intended to lower health spending and reduce the federal deficit. But Congress has never allowed the tax to go into effect.

Why is it called the Cadillac tax?

It is a weird and anachronistic name, evoking a time when the Cadillac was the paradigmatic luxury vehicle. The idea is that the tax would apply only to the most deluxe health plans.
It would, sort of. The tax is devised to apply to health plans that are expensive. That means it would tend to affect the most generous plans, those offering workers the broadest set of benefits, the widest choice of doctors, and the lowest deductibles. But it would also tend to hit some plans that are more typical in their design, but happen to cover a work force that is older and sicker. In practice, the Cadillac tax may affect both the Cadillac owner and the worker who assembles the cars.

Is my plan a Cadillac plan?

Around 21 percent of employers offer health plans today that would be eligible for the tax if it went into effect, according to the Kaiser Family Foundation. The plans that qualify tend to be generous plans, like those offered by companies in very competitive, high-paying industries, or those with unionized work forces. If you use your health plan a lot and have few complaints about it, you might have a Cadillac plan.

To be more precise, if your insurance costs more than $11,000 for an individual plan or $30,000 for a family plan, it might be hit by the tax when it is scheduled to begin in 2022.

Who likes it?

Economists love the Cadillac tax. When Congress considered an earlier postponement of the tax, around 100 of them signed a letter to complain.
The argument for the tax is that our current system, which taxes wages but not health benefits, is distorting. The Cadillac tax, which taxes only the most expensive health plans, makes those bonus benefits more like extra salary. Some employers might still offer them — or they might look to spend less on health care to avoid the tax.
“You can’t get economists to agree about anything — anything!” said Jonathan Gruber, an M.I.T. economist who advised the Obama administration as it was developing the Affordable Care Act. “It raises money, it’s progressive, and it’s efficient. You can’t find a lot of things like that.”
Some deficit hawks also like the Cadillac tax, since, in addition to pushing down the price of health insurance, it was also devised to raise money to pay for other policy priorities.

Who dislikes it?

A lot of people who are not economists. If it ever went into effect, the tax would either increase businesses’ tax burden or encourage them to offer their workers skimpier insurance. Neither outcome is much of a crowd pleaser.
It was Democrats who passed the Affordable Care Act, but in the years since many of the party’s leaders have denounced the Cadillac provision. In their 2016 presidential campaigns, both Hillary Clinton and Bernie Sanders said they wanted to repeal it. Republicans have a more mixed record on the tax. They tend to be more likely to favor proposals that would tax health benefits like income, but many don’t like the particular design of this tax — or the fact that it was part of Obamacare.
“It’s not popular in any way at all, and it’s not showed any signs of becoming any more popular,” said David Cutler, a Harvard economist who helped advise the Obama administration on health policy. “It’s very hard to find anyone who really wants it.”
Unions, in particular, have long loathed the Cadillac tax. Many of them have negotiated hard to preserve generous health benefits for their workers, often at the expense of salary increases.

If it’s so unpopular, how did it ever get passed?

The Cadillac tax is a good example of a public policy that probably never would have passed on its own. But it did not pass alone — it passed as part of a large package of health overhauls in the Affordable Care Act.
The Democratic leadership in Congress and the Obama White House wanted to be sure that the health bill would not increase the federal deficit, even though they also wanted it to expand government-subsidized health coverage to millions of low-income, uninsured Americans. That meant that the law’s writers were looking for ways to trim money out of the existing system in order to pay for the new programs.
The Cadillac tax was appealing because it was estimated to reduce health spending and raise revenue — and the economists close to Democratic politicians liked it. President Obama was also interested in ideas that would reduce the growth in health care spending, and he was persuaded that this policy could help do that.

The pitch that officials made to reluctant lawmakers was that this policy would help pay for policies they loved more.

Is it definitely going to be repealed?

No. The House vote is just one step. The Senate would have to pass similar legislation, and the president would have to sign it. The Republican Senate has voted for previous bills that would delay enactment of the tax, so there may be interest in its permanent repeal. But the Cadillac tax has not been a particular policy priority of Senate leadership, and the Senate Finance Committee has not yet considered a bill to repeal it.

What will it mean if it’s repealed?

In practice, not much. Though the tax has been on the books since Obamacare passed in 2010, its enactment has been continuously postponed. Some businesses have already made changes to their plans in anticipation of its enactment, but they are unlikely to return to richer health plans even if it goes away.
On paper, repealing the tax means the federal deficit would be estimated to grow in coming years. A recent estimate from the Congressional Budget Office said that repealing the tax would raise the deficit by $193 billion between 2022 and 2029. That’s more than the federal cost of the entire Children’s Health Insurance Program over a decade.

 https://www.nytimes.com/2019/07/20/upshot/explaining-cadillac-health-plans.html?

 

Biden and Sanders, Behaving Badly

by Paul Krugman - NYT - July 22, 2019

Health care was a key factor in Democrats’ victory in the 2018 midterm elections, and it should be a big plus in 2020 as well. The shared Democratic position — that every legal resident should have access to affordable care, regardless of income or health status — is immensely popular. The de facto Republican position — that we should go back to a situation in which those whose jobs don’t come with health benefits, or who suffer from pre-existing medical conditions, can’t get insurance — is so unpopular that G.O.P. candidates consistently lie about their own proposals.
But right now, two of the major contenders for the Democratic presidential nomination, Joe Biden and Bernie Sanders, are having an ugly argument about health care that could hurt the party’s chances. There are real, important differences between the two men’s policy proposals, and it’s fine to point that out. What’s not fine is the name-calling and false assertions. Both men are behaving badly. And for their party’s sake, and their country’s, they need to stop it.
Let’s back up. There are, broadly speaking, two ways a country can try to achieve universal health insurance. One is single-payer: The government simply pays the bills. The other retains a role for private insurance but relies on a combination of regulations and subsidies to ensure that everyone gets covered.
We don’t have to speculate about how these systems would work in practice, because every advanced country except the U.S. has some form of universal coverage. Some, like Canada and Britain, use single-payer (in Britain the government also operates the hospitals and pays the doctors). Others, like Switzerland and the Netherlands, have a large role for private insurers.
The clean little secret of health care is that both approaches work when countries try to make them work. In fact, we can see both systems at work right here in America.
More than 100 million Americans are covered by Medicare or Medicaid, which are both single-payer programs; despite Ronald Reagan’s ominous warnings back in 1961, neither destroyed American freedom. Since 2014, millions more have been covered by the Affordable Care Act, which was underfunded and has been subject to extensive Republican sabotage; nonetheless, states like California that have tried to make the act work have experienced huge declines in the number of residents without insurance.
Which brings us back to the Democratic quarrel.
Sanders, of course, has made Medicare for All his signature proposal. Could such a plan work? Absolutely. But there are two valid criticisms of his proposal.
First, it would have to be paid for with higher taxes. While many people would find the increased tax burden offset by lower premiums, the required tax increases would be daunting. And while Sanders has in fact proposed a number of new taxes, independent estimates say that the revenue they’d generate would fall far short of what his plan would cost.
Second, the Sanders plan would require that roughly 180 million Americans give up their current private insurance and replace it with something different. Persuading them that this would be an improvement, even if true, would be a tall order. Indeed, there’s good reason to believe that eliminating the option of retaining private insurance would be an electoral loser. (Elizabeth Warren and Kamala Harris, take heed.)

On the other side, Biden is proposing to build on Obamacare. That can sound like tinkering at the edges. But his actual plan is much bigger and better than is widely realized, with large increases in funding, a public option, and more. It would, arguably, bring the A.C.A. close to the standards of successful European systems.
That said, the Biden plan would preserve the crazy-quilt, Rube Goldberg aspects of our current system, which impose a lot of unnecessary costs and make it too easy for people to fall through the cracks.
So there’s plenty of room for a good-faith Sanders-Biden argument. Unfortunately, that’s not the argument they’re having.
Instead, Sanders is arguing that only single-payer can purge “corporate greed” from the system — an assertion belied by European experience — and broadly hinting that Biden is in the pocket of corporate interests. That’s a criticism you can level about some of Biden’s past policy positions, like his advocacy of the 2005 bankruptcy law. But it’s not a fair criticism of a health plan that’s actually pretty good, and which most people would have considered radical just a few years ago.
For his part, Biden is declaring that the Sanders plan would undermine Medicare. In fact, it would enhance current recipients’ benefits. And it’s a bad sign that Biden, who poses as Obamacare’s great defender, is using a G.O.P. scare tactic familiar from the utterly dishonest campaign against the A.C.A. No Democrat should be stooping to that level.
Unfortunately, Biden and Sanders will be appearing on different nights during the next Democratic debates. So it will be up to other candidates, or the moderators, to put them on the spot. It’s time for both men to stop poisoning their own party’s well.
https://www.nytimes.com/2019/07/22/opinion/biden-sanders-health-care.html?action=click&module=Opinion&pgtype=Homepage 

 

Trump's Medicare Chief: 'I View a Public Option and Medicare for All as Equally Dangerous'

by Andrea Germano - Common Dreams - July 22, 2019

Seem Verma, President Donald Trump's administrator for the Centers for Medicare and Medicaid Services (CMS), came out swinging on Monday against the public option—a plan backed by some centrist Democratic presidential contenders—calling it and Medicare for All "equally dangerous."
Verma's remarks calling for an expansion of the current for-profit healthcare system came during a keynote speech at the Medicare Advantage Summit in Washington, D.C.
They are unsurprising, given her record of seeking to strip away healthcare "protections and provisions for vulnerable people," and, more recently, calling a single-payer plan like Medicare for All "bad" and "scary."
Deploying a standard GOP talking point, Verma said Monday, "we need government to be more hands-off."
She expressed concern over "the proposals we have seen to upend healthcare in America, particularly Medicare for All and the public option." Picking up on an accusation she's levied before, Verma said, "These proposals are the largest threats to the American healthcare system."
A Medicare for All system, she falsely asserted, would boot every American "into a system where Congress and bureaucrats make decisions about their care." Repeating the administration's narrative, Verma said Medicare for All would "harm seniors' access to care."
"I view a public option and Medicare for All as equally dangerous," she said.
According to supporters of Medicare for All, the stated opposition by Verma—like that from Republicans, corporate interests, and even centrist Democrats like 2020 candidate Joe Biden—shows that it makes no political sense to fight for the less transformative public option when a true single-payer plan is achievable.
As the Physicians for National Health Program put it:
Verma framed potential passage of a public option, a plan put forth by Biden, as tantamount to passing a single-payer system.

Access will be compromised for patients, and reimbursement cuts in the public plan will shift more pressure to employer-sponsored plans to make up the difference, driving up costs for 180 million Americans with private insurance. Make no mistake—the public option is a Trojan horse with a single payer hiding inside. It would use the force of government price setting to crowd private insurers out of the marketplace altogether, and achieve the true policy goal of a government-run single payer healthcare system.

Those comments echo industry talk points like the ones put out by the Partnership for America's Health Care Future.
In a statement last week in response Biden's proposal, PAHCF's executive director Lauren Crawford Shaver said, "Unfortunately, Vice President Biden's proposal for a new government insurance system through a 'public option' would undermine the progress our nation has made and ultimately lead our nation down the path of a one-size-fits-all healthcare system run by Washington."
The corporate Democrat-aligned group has been waging a propaganda blitz against a single-payer system, though, as Public Citizen recently noted, they are not alone in their efforts, with other groups recently boosting their spending on such efforts as well.
Those efforts, though, seem to have done little to dampen voters' enthusiasm for ditching the current for-profit system.
A straw poll released Monday by Democracy for America showed that Medicare for All was one of two top priorities—along with the Green New Deal—among the group's more than one million progressive members heading into the 2020 presidential election. It has broad backing as well; other polls have shown a majority of Americans supporting such a healthcare system.
https://www.commondreams.org/news/2019/07/22/trumps-medicare-chief-i-view-public-option-and-medicare-all-equally-dangerous?

I’m the administrator of Medicaid and Medicare. A public option is a bad idea.

by Seema Verma - Washington Post - July 24, 2019

Seema Verma is administrator of the Centers for Medicare & Medicaid Services.

The Affordable Care Act was signed into law nearly a decade ago, significantly expanding the role of the federal government in the U.S. health-care system. It’s telling that many have called for yet another overhaul of health care. This dramatic shift indicates a rare bipartisan consensus that the ACA has failed to achieve its objectives. The question then becomes what comes next.

One common proposal is the so-called public option. It would introduce a government-run plan into the commercial health insurance market or, alternatively, allow consumers under age 65 to buy in to traditional Medicare. The public option has been branded a “moderate” alternative to a complete government takeover of the health-care system under Medicare-for-all. But simply calling something moderate doesn’t make it so. Whether conceived as an expansion of Medicare or the creation of a government health-care option, the public option is a Trojan horse with single-payer hiding inside.

As the administrator of the two largest public health-care programs in the country, Medicare and Medicaid, I can say these programs face major fiscal challenges. Those who seek to expand them do so because of their expected lower price tag on premiums. But there’s a simple explanation that makes the low cost considerably less alluring: Public programs pay health-care providers less than private payers.

According to a study in Health Affairs, private insurance in 2012 paid hospitals approximately 75 percent more than Medicare did for similar inpatient services. Medicaid payment rates were even lower than Medicare rates. That’s why a substantial proportion of providers — 30 percent — do not accept new patients on Medicaid. Rather than expand public programs for future generations, Americans are much more interested in protecting the viability of these programs into the future.

Further, low prices imposed on doctors and hospitals can’t stop health-care costs from rising — as they continually do. This can have effects throughout the health-care system. Someone has to pay the bill — namely, Americans who purchase their coverage directly or through their jobs. In turn, this causes doctors and hospitals to attempt to make up the lost revenue by charging higher prices to private insurers, resulting in higher health insurance premiums for everybody else.

At the same time, a public option would be backed by the full faith and credit of the federal government. This creates a host of problems. While public options can turn to taxpayers to bail them out, private players have no such luxury. They must compete for consumers based on the merits of their product and remain efficient — or suffer in the market as a result. Without market pressure on the bottom line, an expanded government plan would balloon uncontrollably, crowd out private options, push consumers off private plans and reduce choice as private plans flee the market.

The absence of accountability to consumers would slow innovation in public programs to a glacial pace. It can take Medicare years to recognize new technology that private insurance already covers. Medicare took more than a decade longer than private insurers to adopt disposable insulin pumps. The rules and regulations that determine which products are covered become outdated quickly, and it can literally require an act of Congress to change them. The result is innovation stagnation and limited access to new treatments. The president’s budget includes several proposals that attempt to address this.

In any case, we’ve seen this movie before. The ACA’s consumer-operated and -oriented health plans (or co-ops) provide firsthand evidence of the disaster that awaits a rerun. After receiving $2.5 billion in government-backed start-up loans, most went belly up and closed their doors, leaving taxpayers on the hook for any unpaid loans. The co-ops that have closed to date still owe nearly $2 billion. Moreover, the closures of these government-sponsored health insurance companies displaced nearly 1 million people from their health plans.

In the end, these government-sponsored plans couldn’t compete. As a central plank of many health-care proposals being discussed, the public option being proposed today won’t be allowed to fail like the co-ops did. Taxpayers will be forced to foot the bill, no matter how high.

Millions of Americans rely on Medicare and Medicaid. We made a promise to our nation’s most vulnerable to ensure they have access to health coverage. There is something deeply unjust in dumping millions more onto these programs, which are already on an unsustainable fiscal path.

That is why President Trump has promised to keep what works in our health-care system, fix what’s broken and deliver a better experience for all Americans. Instead of introducing even more governmet intrusion into the markets, we must strengthen and protect our existing safety-net programs and address the drivers of costs by fostering a competitive and dynamic private market in which plans and providers compete on the basis of cost and quality — not a system that makes promises that can’t be kept and leaves taxpayers to clean up the mess.

https://www.washingtonpost.com/opinions/a-public-option-for-health-insurance-is-a-terrible-idea/2019/07/24/fb651c1a-ae2e-11e9-8e77-03b30bc29f64_story.html?utm_term=.594d9d94cea8 

Why aren’t voters more willing to abandon a health system that’s failing?

by Ezra Klein - VOX - July 29, 2019

What does it mean to say “if you like your health insurance, you can keep it”?

Some will remember this as a defining debate around the Affordable Care Act. One lesson Democrats took from the collapse of the Clinton administration’s 1994 reforms was that Americans hated the idea of the government canceling their insurance plans. In deference to that view, the ACA was designed to leave most existing health coverage intact, and President Obama repeatedly promised that no one would lose insurance they liked. Even so, about 3 million plans did get canceled because they were beneath the ACA’s minimum standards for health insurance, and the political backlash was fierce.

This debate has reemerged in the runup to 2020. Bernie Sanders’s Medicare-for-all plan, as currently written, would cancel every private insurance plan in the country. Polling suggests that’s lethal: When told that Medicare-for-all would abolish private insurance, respondents flip from favoring the plan by a 56 percent to 38 percent margin to opposing it by a 58 percent to 37 percent margin. These numbers, when combined with the Obamacare backlash and the Clintoncare experience, have underscored reformers’ view that a plan that takes away the private insurance people have and like is doomed.

In response, supporters of Medicare-for-all have struck back with an ambitious reframing: The idea that anyone can keep the health insurance they like under any system but Medicare-for-all is the true lie, they say.

Matt Bruenig, of the People’s Policy Project, is the most aggressive proponent of this view. “The truth is that people who love their employer-based insurance do not get to hold on to it in our current system,” he writes. “Instead, they lose that insurance constantly, all the time, over and over again. It is a complete nightmare.” The only way to enjoy true health security, where your insurance can never be taken away, is “a seamless system where people do not constantly churn on and off of insurance. Medicare for All offers that.”

There’s power to this argument. As a comparison between Medicare-for-all and the status quo, there’d be far more security under Medicare-for-all. But even as he accuses others of dishonesty, Bruenig is weaponizing this point against plans that it doesn’t apply to — most recently, the Center for American Progress’s Medicare Extra plan — and doing so in ways that confuse the underlying issue.

If this were just an internecine debate between supporters of different health reform plans that would all be vast improvements over what we have now, it wouldn’t much matter. But it raises some of the hardest issues in health politics. Private health insurance isn’t theoretical. More than 150 million Americans get insurance through their employers right now. They live in the world that pundits and think-tankers are arguing over. So if the private insurance market as it exists is such a nightmare, then why are people so loath to see it replaced?

This is a question that has crushed past efforts at health reform — and not just federally. In the past few years, Vermont saw its effort to pass single-payer collapse and 79 percent of Coloradans voted down a single-payer ballot initiative.

So why aren’t voters more willing to abandon a system that’s clearly failing? And what kinds of reforms will they accept?

The two types of “insurance churn”

The key idea in Bruenig’s argument is something experts call “insurance churn.” Importantly, though, the term is being used to refer to two different things:

• Researchers use insurance churn to refer to any change in health insurance plans. If I lose my job and become uninsured, that’s churn. If my employer switches insurance providers, that’s churn. If I move from my current job and insurance coverage to another job with a different insurance plan, that’s churn. And so on.
• In punditry, though, people will often simplify churn to the question of losing and gaining health insurance. In this meaning, it’s not churn if my employer switches coverage providers, but it is if my employer fires me and I become uninsured.

You can see the way one definition slides into the other in Bruenig’s post. For most of the analysis, he’s using the first, more technical, definition of churn. He relies on a study of insurance churn in Michigan, for instance, to write:

Among those who had employer-sponsored insurance in 2014, only 72 percent were continuously enrolled in that insurance for the next 12 months. This means that 28 percent of people on an employer plan were not on that same plan 1 year later. You like your employer health plan? You better cross your fingers because 1 in 4 people on employer plans will come off their plan in the next 12 months.

The study he’s referencing found that “Ninety-four percent of respondents with employer-sponsored plans maintained coverage continuously all year.” The lower, 72 percent number includes data showing that “16 percent directly switched to a different employer-sponsored plan and 6 percent gained coverage through either an individually purchased plan, Medicaid, or Medicare.” So that’s the first type of churn, which includes changes to the plans people use, not just changes to whether people are insured or not.

But at the end, when Bruenig says that Medicare-for-all is “a seamless system where people do not constantly churn on and off of insurance,” he’s quietly switching to the second definition of churn.

The core insight here is real: So long as a third party is providing your health insurance, you don’t have full control of its future. You may like the health plan your employer provides now, but they could change that plan, or you could change jobs, or be laid off. The problem is that point applies to public insurance too.

Imagine President Bernie Sanders passes Medicare-for-all in 2022. In 2024, amid a backlash to rising tax rates, Sanders loses reelection to Ohio Sen. Rob Portman. Working with a Republican Congress, Portman restructures Medicare-for-all in a few ways. Where Sanders included coverage for abortion, Portman bars it totally. Where Sanders designed the program to avoid copays and deductibles, Portman, a believer in health savings accounts, reworks it to frontload the cost-sharing. Where Sanders guaranteed coverage to everyone, including unauthorized immigrants, Portman restricts it to legal residents, and adds a work requirement for able-bodied adults.

If any of that sounds far-fetched, consider that Republicans were a single vote away from repealing Obamacare in 2017, and the Trump administration approved Wisconsin’s request to add premiums and a work requirement to its Medicaid program in 2018.

The skepticism Bruenig brings to private insurance is the same skepticism many bring to single-payer insurance. You like your government-provided health plan? Better cross your fingers, because your side just lost the White House, and the incoming administration wants to slash health care spending by 15 percent, drug-test all beneficiaries, and turn the whole thing over to private contractors.

Not all churn is equal

A problem with the term “churn” is that it collapses both good and bad dynamics into the same label. Involuntary churn is a problem. But voluntary churn typically goes by another name: choice.

Take Medicare Advantage, the suite of private insurance options offered inside the Medicare program. About a third of Medicare enrollees choose Medicare Advantage, and about 10 percent of Medicare Advantage members voluntarily choose to switch to another plan each year. Medicare Advantage’s enrollees are slightly more satisfied with their coverage than those in traditional Medicare, so it’s reasonable to assume they appreciate the opportunity for churn.

Last week, I wrote about the Center for American Progress’s Medicare Extra plan. I won’t recap the entire piece here, but the short version is that Medicare Extra rebuilds the health system around a revamped Medicare plan, but it allows people to remain in employer-sponsored insurance, traditional Medicare, or VA care if they so choose. It also preserves some private options in Medicare for those that want them. It’s an effort to capture the main benefits of single-payer — universal, guaranteed coverage alongside Medicare-based pricing — without taking away the insurance plans most people have and like. Bruenig was, to say the least, not happy with my description:

This is a good example of the slipperiness in the way Bruenig deploys this argument. Under Medicare Extra, there’s no churn on and off health insurance: it’s a universal program. If you chose to remain on your employer-sponsored insurance and then you got fired, you’d just be added to Medicare Extra.

Bruenig’s claim that this is a lie rests on switching his definition to the first type of churn, the one that counts any change in plan. Under Medicare Extra, it’s true, you could end up switching from one employer-sponsored insurance plan to another, or from an employer who offered Cigna to one who bought into Medicare. Or you could choose to switch from Medicare to your employer’s insurance, or to the private options offered under Medicare Choice.

Bruenig says this would be “entirely out of your control.” That’s true in some cases, and not in others. Either way, Medicare-for-all is just as vulnerable to that critique: You can keep Bernie Sanders’s Medicare-for-all plan until the moment some other president and Congress decides to change the law. It’s also outside of your control. (And in a system where the White House and the Senate are both held by the party that won fewer votes, the idea that it is in your control because the government reflects the will of the people isn’t particularly convincing.)

This is the problem with the rhetorical game Medicare-for-all’s supporters are playing. If you narrow the definition of insurance churn to whether or not you have insurance, the argument doesn’t work as a cudgel against some of the competing plans like Medicare Extra. If you widen the definition of insurance churn to any change in your insurance plan, then it becomes a cudgel against Medicare-for-all too.

You can’t talk yourself out of public opposition

This gets to the broader context of this debate. There’s an effort among Medicare-for-all’s supporters to argue that nothing but pure single-payer can solve the problems of the health care system, and so any other plan, even if it’s more aligned with what the public wants, is an unacceptable half-measure. Since those plans make a virtue out of offering people more insurance choices, and since Medicare-for-all suffers in polls for abolishing private insurance, you need to make the offering of those choices into a weakness.

But in doing, you end up sidestepping the hard political question here, the one those other plans are trying to respond to: If the private insurance market is such a nightmare, why is the public so loath to abandon it? Why have past reformers so often been punished for trying to take away what people have and replace it with something better?

It’s simply not the case that when you say, in normal English, “if you like your X, you can keep it,” people believe you’re protecting them from all exigent circumstances. People live in the employer-based health insurance market now. They’re dealing with the instability Bruenig and others are pointing out as we speak. The fact that they’re not clamoring for the government to take it over demands exploration, not rebuttal.

Trying to redefine “it’s possible to lose the insurance you have now” as equivalent to “the government will take away the insurance you have now and move you to something different” isn’t a way of answering the concerns people have — it’s a way of trying to talk yourself out of answering them. And that’s a dangerous strategy.

It’s particularly unwise when the public’s views are as clear as they are here. A new Marist/NPR poll tested support for both “Medicare for all that want it — that is, allow all Americans to choose between a national health insurance program or their own private health insurance” and “Medicare for All — that is, a national health insurance program for all Americans that replaces private health insurance.” “Medicare for all that want it” polled at 71 percent. Medicare-for-all that replaces private insurance polled at 41 percent. Supermajority support becomes a minority position. Why?

There are different interpretations of what’s going on here. Many Americans simply don’t trust the government. Others don’t much like radical change, even if they do trust the government. Some reasonably want private options as escape hatches if the government option is wrecked by a future Congress, or marred by incompetent administration. Many don’t realize how much their insurance costs, because employers pay, on average, 70 percent of premiums, even if that quietly comes out of wages. And while about 60 percent of Americans think it’s the government’s responsibility to ensure everyone can access health care, that leaves 40 percent of the country that disagrees.

Indeed, the political risk of a plan like Medicare Extra isn’t that it changes too little for the public’s comfort, but that, like Medicare-for-all, it changes too much. Everyone on Medicaid gets forced into the new system. Everyone on Obamacare’s individual markets gets forced into the new system. The new plan will be better and more comprehensive than what came before it, so in theory, it should be a welcome change. But if “in theory, it should be a welcome change” always cashed out in practice, we would have fixed the health system long ago. The political upsides of Medicare Extra are that it won’t require as large tax increases, it won’t upend employer-based insurance, and it can at least claim that private choices will be available, but for all that, it will still mean huge disruption, far more than attended Obamacare.

For the record, I’m not opposed to Medicare-for-all. It’s one of many health systems that I think would be a vast, vast improvement on what we have now. I want more people to have better health care, and my fear is that in treating public opinion as infinitely malleable or simply confused, Medicare-for-all’s supporters will trigger a backlash that destroys the effort, just as so many health reformers have before them.

Risk aversion here is real, and it’s dangerous. Health reformers don’t tiptoe around it because they wouldn’t prefer to imagine bigger, more ambitious plans. They tiptoe around it because they have seen its power to destroy even modest plans. There may be a better strategy than that. I hope there is. But it starts with taking the public’s fear of dramatic change seriously, not trying to deny its power.

https://www.vox.com/policy-and-politics/2019/7/29/8910387/medicare-for-all-insurance-private-abolish-bruenig 

Trump Administration Proposes Allowing Drug Imports for Cheaper Prescriptions

by Katie Thomas - NYT - July 31, 2019

The Trump administration said on Wednesday that it was taking steps to make it easier for less expensive prescription drugs to be imported from other countries, particularly Canada, a move that has long been supported by progressives but has encountered fierce opposition from the pharmaceutical industry.
Under the plan, the administration said it would propose a rule to permit pilot programs developed by states, pharmacies or drug distributors that sought to safely import prescription medications from Canada. The Food and Drug Administration also planned to advise manufacturers for how they could import high-priced drugs like insulin that are sold more cheaply in other countries.
“President Trump has been clear: For too long American patients have been paying exorbitantly high prices for prescription drugs that are made available to other countries at lower prices,” Alex M. Azar II, the secretary of health and human services, said in a statement released Wednesday.
Although the announcement signaled a major policy shift because Democratic and Republican administrations have generally opposed importing drugs from overseas, the proposal was also limited in nature. The proposed rule would not apply to high-priced drugs like insulin or biologic drugs like Humira, because of exceptions included in earlier legislation. And the F.D.A. guidance would only permit importation of drugs, including insulin, if the drug makers agreed to take part in the plan.

Democrats and Republicans in Congress have been debating legislation that would allow importation of drugs to obtain cheaper prices, and other measures to try to rein in costs. But leading members of Congress have said that major proposals won’t be fully prepared before September.
The rising price of prescription drugs has been a popular topic at the Democratic presidential debates, and the timing of the administration’s announcement fell in the middle of the Tuesday-Wednesday schedule of this month’s debates for the Democratic candidates.
On Tuesday night, Senator Bernie Sanders of Vermont, who has long supported the idea, said he traveled to Canada on Sunday with a group of consumers who were buying insulin at what they said was one-tenth the price they usually pay in the United States. Higher prices are being charged by “the crooks who run the pharmaceutical industry in America today,” Mr. Sanders said.
Many other countries are able to negotiate lower prices because their health care systems are run by the government, giving them more leverage. In the United States, private insurers typically negotiate with drug companies on prices. The drug industry has said that the prices overseas are artificially low and that people in those countries often don’t get access to as many new drugs as Americans do.
The new policy is an about-face for Mr. Azar, who like other Republicans has been skeptical about importing drugs from other countries. The idea had also been rejected by previous commissioners of the Food and Drug Administration, including Margaret Hamburg, who raised concerns about importing counterfeit products.

In May 2018, Mr. Azar called the idea a “gimmick” and said: “They are a lovely neighbor to the north, but they’re a small one. Canada simply doesn’t have enough drugs to sell them to us for less money, and drug companies won’t sell Canada or Europe more just to have them imported here.”
But over the past year, the tone has shifted as Republican state leaders have joined Democrats in talking about importing drugs from Canada. The Florida governor, Ron DeSantis, has said he wants to be able to do so, and in May Mr. Trump directed Mr. Azar to help make it happen. Vermont also has a law allowing importation although it has not gotten federal approval.
Canadian officials have warned the United States government that importation programs could jeopardize their own supply of drugs, leading to potential shortages, according to a Reuters report this month. Others have said drug companies could limit their supplies to those countries or raise their prices in response to any new American policy.
Mr. Trump has railed against the idea that many countries pay less for drugs than in the United States, calling it a form of “global freeloading” because many treatments sold overseas were developed by American companies.
In July, Mr. Trump said he was planning an executive order, a “favored-nation clause,” which would allow the United States to pay whatever the lowest price is in other countries. But his comments were vague, and it was unclear whether he was referring to a more limited pilot program being proposed by his administration that would apply only to a small subset of drugs administered by doctors and in clinics. There were also questions about how far any executive order could go without congressional legislation.
Several of Mr. Trump’s other proposals to lower drug prices have faltered recently, including efforts to force drug companies to list their prices on TV ads.
https://www.nytimes.com/2019/07/31/health/drug-imports-canada.html

 

Maine Health Advocates React To Trump Administration's Prescription Drug Import Announcement

by Patty Wight - Maine Public - July 31, 2019

Maine Democrats and health advocates are praising an announcement Wednesday from the Trump administration that it will explore ways to import cheaper prescription drugs from Canada.
The announcement bolsters a new state law, signed by Gov. Janet Mills, to develop a wholesale drug importation program with our neighbors to the north. But some health policy experts are skeptical that such a plan is viable.
Democratic Maine Senate President Troy Jackson was the sponsor of the state’s bill to establish a drug importation program with Canada. He says it's about time that the federal government took action to lower drug prices.
"We put a lot of effort in this session, and it always was to push the federal government to do what is right, and it feels like that's finally coming to fruition,” Jackson says. “So I feel a real sense of hope in that regard."
His bill was signed into law by Mills, but it ultimately requires federal approval. The Trump administration's announcement signals that that’s more likely.
Ann Woloson of Consumers for Affordable Health Care says it could happen relatively quickly.
"The hope would be that Maine would be able to do something sooner rather than later, perhaps in the next year, year and a half," says Woloson.
But others are less confident that any plans to import drugs from Canada are viable. Maine-based independent health policy consultant Mitchell Stein says one reason is that the U.S. market for prescription drugs is exponentially larger than the Canadian.
"We've seen busloads of people going into Canada and going to a drug store, and that can work, but it just can't scale,” Stein says. “There currently isn't the supply in Canada."
And Stein is doubtful that Canada would be able to increase its supply.
"There's no reason to think that manufacturers would be willing to increase the lower cost supply when they're currently getting more money here in the U.S." Stein says.
Stein also points to a recent report in Reuters. The news outlet obtained documents that revealed Canadian officials are opposed to U.S. plans that threaten the supply and cost of prescription drugs for its own citizens.
Sen. Jackson, however, says that's not the message he's getting in his discussions with officials in New Brunswick and Quebec.
"I think we could do that tomorrow if we had a plan that was approved by the federal government,” Jackson says. “I mean, they're waiting, you know, ready and willing."
Woloson, from Consumers for Affordable Health Care, also thinks Canadian suppliers would be motivated to export more drugs because of the financial benefits.
"I hear the skepticism, but I don't honestly believe that it's going to be a problem,” Woloson says. “We can't not attempt to do this, especially if the end effect means Maine people will end up paying less for the drugs they need."
Gov. Mills is ready to press forward with Maine's program. In a media release, she says she spoke to U.S. Health Secretary Alex Azar Wednesday to let him know that Maine is ready to review, shape and take advantage of the new rule.
https://www.mainepublic.org/post/maine-health-advocates-react-trump-administrations-prescription-drug-import-announcement

Medicare for All? For More? Here’s How Medicare Works

by Abbie Goodnough - NYT - July 31, 2019

Medicare, the federal health insurance program for people who are 65 or older, has become something of a panacea in the Democratic presidential race.
Some candidates, including Senators Bernie Sanders and Elizabeth Warren, want to give it to everyone and even expand its benefits. Others, like former Representative Beto O’Rourke, want to give it automatically to people who don’t have other health insurance. Many, including former Vice President Joseph R. Biden, want to give people the right to buy into a Medicare-like public health insurance program.
Whatever their positions, Medicare is what most of the candidates are holding up as a model for universal coverage, a goal they all embrace.
Medicare is popular among its 60 million beneficiaries, but the program also has limitations, and it is certainly not “free.” Co-payments can be high for some people, especially for long-term hospitalization and some medications. Some Democratic proposals, including those from Mr. Sanders and Ms. Warren, would change that by eliminating premiums and deductibles, and pay for the program instead with higher taxes.

As expansion of Medicare becomes a campaign season rallying cry, we took a look at what it’s like to be on Medicare now.
Here are some answers to basic questions.

What exactly does Medicare cover? Are the benefits good?

The benefits are comprehensive, though not exhaustive. Some proposals would expand them, but Medicare divides benefits into categories. One, Part A, covers inpatient care at hospitals and — with some limits — skilled nursing facilities, where people often go to recover from an injury or illness. It also covers hospice care and, in some circumstances, home health care. Another category, Part B, covers doctor appointments, outpatient procedures and tests, some mental health services, as well as wheelchairs, walkers and other equipment. Prescription drugs are covered under Part D. Part C is a privately run managed care option called Medicare Advantage.

What doesn’t Medicare cover?

Medicare does not cover glasses, basic eye exams, hearing aids and most dental care — frustrating omissions for many beneficiaries, who are at an age when they are more likely to need these services. It also won’t pay for care received outside the United States.
But by far the most expensive thing Medicare doesn’t pay for is long-term care in nursing homes, assisted living facilities or at home. Some people buy long-term care insurance, or spend down their assets to qualify for Medicaid, which does cover nursing home care. A private room in a nursing home cost an average of $100,375 last year, according to Genworth, a financial company.

How much does it cost?

Part A typically has no monthly premiums (like Social Security, it’s financed by payroll taxes all workers pay), but it has a deductible of $1,364 per “episode of illness,” plus a fixed amount — as high as $682 a day — if you spend more than 60 days in the hospital.

For Part B — doctor’s visits and outpatient care — premiums are based on income. The standard premium this year is $135.50 a month, but financial help is available for people with low incomes who don’t qualify for Medicaid, the government health program for the poor, which covers just about everything.
Richer Medicare beneficiaries — individuals with annual incomes over $500,000 — pay $460.50 a month. Premiums are typically deducted from people’s Social Security checks. Part B also has a deductible of $185 a year, and co-payments of 20 percent after you reach your deductible.
Many people buy supplemental “Medigap” insurance to cover Medicare’s out-of-pocket costs.
Unlike Affordable Care Act plans, Medicare has no cap on out-of-pocket spending, so the cost can climb quite high for sick people. An analysis by the nonpartisan Kaiser Family Foundation found that Medicare enrollees in fair or poor health spent an average of $6,128 in 2013, or 47 percent of average Social Security income.
Prescription drug costs can also be high in Medicare, and they represent one of the most complex, confusing parts of the program. Medicare Part D plans are run by private insurers, and the premiums cost $40 a month on average this year, according to Kaiser. There are also annual deductibles before coverage kicks in — they are capped at $415 this year — plus co-payments and coinsurance. But if your income is low enough, you may qualify for extra help paying for drugs, and in some cases, owe no premiums or out-of-pocket costs.
Then, there is the dreaded “doughnut hole” — a gap in which the Medicare drug plans don’t pay for patients’ medications after they have spent a certain amount — this year, $3,820. At that point, enrollees have to pay 25 percent of the cost of brand-name drugs, and 37 percent of the cost of generic drugs, until their total out-of-pocket spending has reached $5,100. Once they hit that, they qualify for “catastrophic coverage,” and only pay a small co-payment for covered drugs for the rest of the year.
Kaiser recently found that one million Medicare beneficiaries had out-of-pocket spending above the catastrophic threshold in 2017, averaging $3,214.

What is Medicare Advantage?

Medicare Advantage is an increasingly popular alternative to traditional Medicare. Advantage plans are offered by private insurers that have contracts with Medicare. These plans have all the same benefits as traditional Medicare, and often more, such as dental care or health club memberships. Co-pays and deductibles vary depending on the plan. Unlike traditional Medicare, all Medicare Advantage plans have limits — $6,700 this year in most cases — on out-of-pocket spending.

Medicare pays Advantage plans a fixed monthly sum for each beneficiary, while in traditional Medicare, providers are paid for each service based on an annual fee schedule. As a result, Advantage plans tend to use tools like pre-authorization requirements and strict provider networks to control costs.
Those restrictions can be a turnoff to people with a lot of medical needs. Some data suggests people with Medicare Advantage tend to be healthier but less wealthy than those with traditional Medicare. One thing is certain: the private plans are growing in popularity. About one-third of Medicare recipients, or 22 million people, now have them, up from six million in 2005.

Can people choose any doctor they want?

This depends largely on whether they have traditional Medicare or a Medicare Advantage plan. Traditional Medicare allows beneficiaries to seek care from any doctor or hospital in the United States that accepts it, and does not require referrals to specialists or prior authorization for services.
But Medicare Advantage plans typically have strict networks of medical providers that beneficiaries have to use unless they are willing to pay more. Some Advantage plans may cover care outside the network, according to the Center for Medicare Advocacy, but the out-of-pocket costs are generally higher than for in-network care. Advantage plans do cover emergency care outside their network — if you are traveling domestically, for example — but nothing else.

Does every doctor and hospital accept Medicare?

No, but most do. According to the federal Centers for Medicare and Medicaid, 2,752 doctors and other providers opted out of Medicare in 2018 — a minute number considering there are more than one million practicing doctors alone. Psychiatrists are the biggest category of doctors who opt out, according to Kaiser.
A small share of doctors who accept Medicare are called “nonparticipating providers,” meaning they can choose to charge Medicare patients higher fees, up to a certain limit. The patients are responsible for paying the full amount beyond what Medicare pays — a practice called balance billing.
It is even more rare for a hospital not to accept Medicare, although some private psychiatric or other specialty hospitals that cater to the wealthy may not.

Can you appeal a decision if Medicare refuses to cover a service?

Yes, although few people take this step, at least according to a report last year by the inspector general at the Department of Health and Human Services. The report found that beneficiaries and providers appealed more than 863,000 denials from 2014 through 2016 — only about 1 percent of the total number of denials during that period. But their success rate was high: About 70 percent of the appeals were fully successful at the first level (there are five possible levels to keep appealing to), according to the report. Most were from providers regarding payments that had been denied, not patients regarding services that had been denied.
https://www.nytimes.com/2019/07/31/health/medicare-insurance.html?action=click&module=Well&pgtype=Homepage&section=Health

 

 

Health Care Reform Articles - July 20, 2019

Column: In health care, the free-market model has failed
by Kenneth Dolkart - Valley News - July 15, 2019

“Medicare for All” is at the confluence of currents running through our nation. Consciousness is rising that we might enjoy the automatic, universal and high-quality care that is taken for granted in many nations. We trail the developed world in metrics of care like longevity, access, equity, infant and maternal mortality, and rates of death from causes otherwise amenable to care. All too often, ZIP code determines life expectancy.
The health industry sector outperforms the stock market, even as schools cannot afford insurance premiums for teachers.
Nurses and doctors watch countless people lose their health, since absent or inadequate medical coverage promotes belated attention to symptoms.
As some Americans enjoy wondrous medical advancements, others cannot afford the insulin they need. And a growing undertow of “diseases of despair,” such as suicide, alcoholism and opioid overdose, have taken their toll.
U.S. life expectancy has been declining the past three years, for the first time since 1918.
The consequences of the deregulation of medical insurance are obvious.
Costs of employee-sponsored family health insurance plans leaped ahead of inflation, from $5,791 in 1999 to $18,142 in 2016, according to the Kaiser Family Foundation. Middle-class incomes have been stagnant as wages are diverted to the “health dollar” and destined for insurance company profits and CEO salaries. Health insurance deductibles have risen 200 percent since 2008, along with other tactics that shift costs to the enrollee and discourage obtaining services.
The private managed care bureaucracy is geared to profit, and overall U.S. administrative costs are four times that of Canada and three times that of European nations, according to the Organization for Economic Cooperation and Development. Absent regulation allows unbridled and unjustified increases in drug and equipment prices. The cartel-like practice of “pay-for-delay” occurs regularly as drugmakers pay off generic companies to not produce cheaper — but otherwise identical — medication.
Apart from antitrust actions, the prices of medical products and services explode beyond what a reasonably functioning market would dictate.
It is evident that applying free-market consumer models to health care is as appropriate as applying rules of baseball to hockey.
Profits above patientsThe recent effects of the corporatization of medical “providers” are also clear.
The vanishing primary care doctor runs gauntlets to get tests reimbursed and hires staff solely to interact with insurers. Burnout from the ever-expanded clerical burdens of electronic medical records thins the ranks of doctors and nurses. The promise of electronic medical records was lost when it was hijacked for capturing billings, rather than clinical utility.
(Wouldn’t it be nice if the clinician could “ask Siri” to “find last pathology report” and “schedule blood count in two weeks,” or “analyze drug interactions”?)
Companies with a duty to put stock prices above patient interests cynically exploit the professional accountability of medical staff, as physician and author Danielle Ofri observed in a recent New York Times piece, “Is Exploiting Doctors the Business Plan?”)
Abuse of the public trust is certainly not unique to health care.
Industry-aligned Cabinet billionaires dismantle the federal oversight agencies they command. “Dark money” influence is unabated and oligarchs pull the levers of national legislation. Lobbyists for Big Oil mythologize climate change, big banks set the terms of their next failures and the National Rifle Association legislates a gun dystopia. So too, Big Pharma and health insurers profit from the legislation they draft.
Urban hospitals convert health dollar surplus into real estate investments, while rural hospitals collapse in the absence of coordinated support. The Justice Department tries to dismantle the Affordable Care Act scaffolding while millions of Americans are still on it.
Our multiple, episodically introduced, parallel public insurance systems still leave 30 million Americans uninsured.
Now there are numerous proposals to achieve universal coverage, reduce complexity and cut overall costs. Some “Medicare for All” plans propose incremental dissolution of profit-directed insurance bureaucracies with a single federal payer built upon Medicare. There is no “nationalization” of hospitals or doctors, as some critics charge.
“Medicare for Some” proposals, such as the “public option,” allow non-seniors to purchase Medicare and may be more politically palatable to those with employer-coverage, but they do not reduce complexity nor lower costs, and future recessions will eliminate such coverage for many.
Other well regulated and simplified hybrid systems can be envisioned. Still, any cost-effective system, “all-payer” or otherwise, requires transparent and uniform insurance industry practices, enforcement of existing regulations and the enabling of negotiation between tax-supported payers and drugmakers. So expect smoke, mirrors and twitters of fear, uncertainty and disinformation from the Partnership for America’s Health Care Future — a coalition of lobbying groups including America’s Health Insurance Plans, the American Medical Association, the Federation of American Hospitals and BigPharma — which is already hard at work.
We realize that the anonymous “dark money” financing of election efforts and the sanctioned bribing of Congress is incompatible with a representative democracy. Citizen efforts to create legislation for policies that have long had overwhelming support have been stymied by misinformation and the stoking of division, whether it be by the AMA or the NRA.
Still, the tide may be turning. Young people and an energized electorate are clamoring to “promote the general welfare, and secure the blessings of liberty” offered in the preamble to the Constitution. We will recognize such a democracy when, among other changes, this wealthy nation fulfills the moral imperative of assuring modern, universal and affordable health care to all Americans.
Kenneth Dolkart is a physician who lives in Grantham

https://www.vnews.com/Column-In-health-care-the-free-market-model-has-failed-26254558

Medicare for All and Private Insurance: It is like mixing oil and water

by James Kahn - Tarbell.org - July 19,, 2019

At the recent Democratic debate, Lester Holt asked for a show of hands: Who would end the role of private insurance companies as part of health care reform? Four hands went up – Bernie Sanders, Bill de Blasio, Elizabeth Warren, and Kamala Harris. Other candidates argued for incremental expansions of Medicare within our current heavily private insurance system. John Delaney made a plea to “keep what’s working” – i.e., private insurance that people like. After the debate, Harris muddied the waters a bit, saying she misheard the question, and favored a role for private supplemental insurance. 
How do we make sense of all this? In this perspective, I unpack the idea of private insurance – considering benefit design, marketing, financial coverage, and profit status. I examine the potential role of private insurance in Medicare for All (M4A) or single payer health care. Preview: the role is minimal to none.
Let’s start with the current system. Private insurance, mainly employment-based, covers two-thirds of the population and one-third of health spending. It is typically fairly broad in the kinds of services covered, but with many limits and exclusions, and no standardization. Certain features, such as wellness care, are added to attract healthier enrollees. Marketing is intense. Financial coverage is highly variable, often with extensive cost-sharing (high deductibles, copays, and excluded services or providers). Most insurers are for-profit, and even among not-for-profits executive salaries are sky high. In these ways, private insurance echoes many features of other free market products.
Over the last decade, private insurance got a little better, then worse again. Obama’s Affordable Care Act (ACA) established standards for insurance to protect the policy holders, including required types of coverage (e.g., hospital and ambulatory), specified tiers of actuarial rates (percent of covered health care paid), community-based premiums (based on age and gender) rather than charging more for individuals with medical problems, maximums on out-of-pocket costs, and prohibition of egregious practices like “recission” (retroactively revoking insurance based on trivial errors in applying). The ACA also imposed an individual mandate, and set up insurance exchanges to facilitate that. Here’s the worse again part: The Trump administration has undone the mandate and created massive loopholes to foster insurance plans without protections for policyholders.
Private insurance has also permeated public programs. “Medicare Advantage” is the capitated (monthly set payment) alternative to traditional Medicare fee-for-service, which has been subsidized by Congress for years and still overcharges. Medigap policies cover costs not paid by Medicare. And the Medicaid program is now also largely capitated via private plans.
As you can see, private insurance is highly variable in the U.S.
Not so in other wealthy democracies. Outside the debates, some experts and pundits have proposed following the Swiss or German model of relying on private insurers instead of a government payer. This may leave the impression that their private insurance is like ours. In fact, they differ in nearly all important ways. First, the private insurers sell mainly a single, standardized benefit package. This broad benefit package assures excellent coverage. It also profoundly simplifies system administration – providers deal with a single set of rules and billing procedures. Second, financial coverage is much better: little or no deductible, low cost-sharing, and access to any provider, so no out-of-network charges. Third, marketing is very subdued. Finally, insurers are not-for-profit for these primary health plans. (Some ancillary insurance can be for-profit.)
So… is there a role for private insurance under M4A? 
The big answer is “no”. All M4A proposals, including the Sanders bill, have a single payer. This strategy is what confers the many gains of M4A. First, a single payer (the government) means simplicity for enrollees and providers, yielding a massive 10% overall savings via administrative streamlining. Having multiple insurers covering core services would undermine those gains. In addition, a single payer can effectively negotiate on prices, in particular with drug companies. Finally, and importantly, having private insurance would undermine equity and a shared commitment to the public payment system. Imagine someone making $1 million per year and because of progressive tax-based financing is paying the costs of five people on the public plan. People in that position may feel it’s justified to reduce the public system generosity by 20% to pay for his insurance plan. Or that wealthy person may insist on tax subsidies for private insurance premiums, again stealing money from the public system. We’d be exacerbating inequality.
OK, so no major private insurance role within single payer. Is there any role?

• What about emulating the Swiss system? Perhaps…but can we really get there, given our corporate culture? One product, not-for-profit? What companies would be interested?
• What about insuring gaps in coverage? Good question. M4A proposals don’t have major gaps in coverage, except sometimes long term care. Private insurance might have a focused role there, but nothing as large as Medigap today. In my view this would be suboptimal, but it’s a reasonable discussion.
• What about Kaiser and other HMO models? Some M4A proposals allow for capitated care systems. Personally I think that’s a good idea. But it wouldn’t be insurance, it would be a care system.
• What about supplemental coverage for low-value/non-core medical services, such as private hospital rooms or alternative care models? As long as it’s not totally discretionary (like most cosmetic surgery), could be.
• Could private insurers handle the billing process? There could be private vendors for these services, and current insurers have some expertise in this area. But it’s not really private insurance.
• What about for individuals who want care from providers who choose not to participate in M4A, e.g., concierge medicine? That will be out-of-pocket, not insurance. See above for all the problems with allowing private insurance for core services.
• What do we say to people who like their health insurance? We ask them, is it your insurance you like, or excellent access to providers and coverage of care? Because under single payer both will improve – access to any provider, and low or no cost-sharing.

Ultimately, in my view, private insurance cannot have a central role in M4A, because it would undercut what’s so powerful about a single payer. But perhaps it can have a focused role.
James G. Kahn MD MPH is Emeritus Professor of health policy at the University of California San Francisco.
https://tarbell.org/2019/07/medicare-for-all-and-private-insurance-it-is-like-mixing-oil-and-water/?

Send Me Back to the Country I Came From

by Timothy Egan - NYT - July 19, 2019

He’s right, this angry old man in melting bronzer shouting in the July heat: Those of us who don’t like what’s going on in this country should get the hell out. “Go back,” as he said, to the “crime-infested places from which they came.” A fine idea.
For me, as with more than 30 million other Americans with my hyphenate, that’s tiny Ireland, the country once so infested with crime, famine, disease and assorted horrors of foreignness that its British overlords said a merciful God was doing a favor by killing off the starving masses.
So back I went to have a look. This, mind you, was just before President Trump’s suggestion to his fellow citizens to get out. And also, generations after someone on my father’s side made the choice to flee for life itself, rather than fall into the cold Irish ground through the bottom of a reusable coffin.
What I found on that island where typhus once took entire families as they shivered on floors of mud, where, by one medical estimate, 50 percent of the children in Dublin once died before their first birthday, is now a land of universal health care.

Health care for all residents: It’s still a surprise to someone from a nation where the number of uninsured Americans has gone up by seven million under Trump. I had left a place where nearly one in seven people are left to fend for themselves when sick, to a fully covered country, the norm in most of the industrialized world.
What I found in that place where barefooted, Gaelic-speaking hordes once could not read an English sign are colleges nearly free to its citizens — good colleges, at that. Imagine, a family not having to bankrupt itself to help a child off to a better life.
What I found is a republic where nearly one in eight people were born abroad, nearly as high a percentage as the foreign-born population of the United States. The prime minister, Leo Varadkar, is himself a son of an Indian immigrant. His father was born in Mumbai, while his mother hails from County Waterford, the home also of my mother’s distant family.
That 19th-century hellhole has become a 21st-century heaven. The Irish have become us — what we wanted and aspired to. They are living our national narrative, a country open to those fleeing oppressors and lack of opportunity. Its prime minister would never gloat over a “send her back” chant at a hatefest directed at new members of the republic.
Back home in America, the unimaginable is the new norm: a fully blossoming fascism. We’re stuck in a hideous loop of hate. But it‘s also an idiocy loop.

Why are we arguing about something any second grader has already settled after looking around the classroom and realizing that nearly every other child is a descendant of someone from a foreign land?
Read the resolution the House of Representatives passed on Tuesday, citing Ronald Reagan, John F. Kennedy and Benjamin Franklin, and quoting Franklin Roosevelt’s call to “remember always, that all of us, and you and I especially, are descended from immigrants and revolutionists.” It’s the kind of immigrants-make-a-nation-stronger boilerplate that would normally pass the House with unanimous consent, but it drew only four Republican votes.
This is how low Trump has taken us. We are a debased nation fighting over the scraps of our former principles. Should someone offer a resolution saluting the “purple mountain majesties” of the United States, every Republican would vote against it if Trump tweeted against a color that is not orange. Senator Mitch McConnell, whose immigrant wife is indirectly a target of this sludge, would say, as he did about the “send-her-back chants,” that the president is “on to something.”
I’m against the dismissal of others with the pre-emptive pejorative of “white privilege.” It closes minds and ends conversations. But this is one case where white privilege applies. For Trump’s tweet wasn’t aimed at me. Nor was it directed at his vice president, the cipher and coward Mike Pence, himself an Irish-American.
Trump’s hate blast was directed solely at people of color.
His tweet was the textbook definition of racism. And I should add in the interest of full transparency, I disagree with much of the policy initiatives of the four left-wing congresswomen targeted by Trump. It was wrong and incorrect for them to make Nancy Pelosi’s disagreement with them about race. That episode was another textbook illustration of why the far left has trouble winning a majority.
But let’s leave that discussion for another day. Back in the country from which I came, the Irish appear genuinely perplexed at this American vomiting of principle. Writing in “Irish Times,” Oliver Sears, a British-born resident of Ireland and son of a Polish holocaust survivor, wondered how any immigrant could ever vote for Trump.
I heard a similar thing when I went back: How could Irish-Americans vote for this awful man without becoming traitors to their heritage? For this Ireland has become what America used to be. If only America could be more like this Ireland.

https://www.nytimes.com/2019/07/19/opinion/send-her-back-ilhan-omar.html 

Health Insurers Make It Easy for Scammers to Steal Millions. Who Pays? You.

by Marshall Allen - Pro Publica - VOX - July 19, 2019   

Ever since her 14-year marriage imploded in financial chaos and a protective order, Amy Lankford had kept a wary eye on her ex, David Williams.

Williams, then 51, with the beefy body of a former wrestler gone slightly to seed, was always working the angles, looking for shortcuts to success and mostly stumbling. During their marriage, Lankford had been forced to work overtime as a physical therapist when his personal training business couldn’t pay his share of the bills.

So, when Williams gave their three kids iPad Minis for Christmas in 2013, she was immediately suspicious. Where did he get that kind of money? Then one day on her son’s iPad, she noticed numbers next to the green iMessage icon indicating that new text messages were waiting. She clicked.

What she saw next made her heart pound. Somehow the iPad had become linked to her ex-husband’s personal Apple device and the messages were for him.

Most of the texts were from people setting up workouts through his personal training business, Get Fit With Dave, which he ran out of his home in Mansfield, Texas, a suburb of Fort Worth. But, oddly, they were also providing their birthdates and the group number of their health insurance plans. The people had health benefits administered by industry giants, including Aetna, Cigna and UnitedHealthcare. They were pleased to hear their health plans would now pay for their fitness workouts.

Lankford’s mind raced as she scrolled through the messages. It appeared her ex-husband was getting insurance companies to pay for his personal training services. But how could that be possible? Insurance companies pay for care that’s medically necessary, not sessions of dumbbell curls and lunges.

Insurance companies also only pay for care provided by licensed medical providers, like doctors or nurses. Williams called himself “Dr. Dave” because he had a Ph.D. in kinesiology. But he didn’t have a medical license. He wasn’t qualified to bill insurance companies. But, Lankford could see, he was doing it anyway.

As Lankford would learn, “Dr. Dave” had wrongfully obtained, with breathtaking ease, federal identification numbers that allowed him to fraudulently bill insurers as a physician for services to about 1,000 people. Then he battered the system with the bluntest of ploys: submit a deluge of out-of-network claims, confident that insurers would blindly approve a healthy percentage of them. Then, if the insurers did object, he gambled that they had scant appetite for a fight.

By the time the authorities stopped Williams, three years had passed since Lankford had discovered the text messages. In total, records show, he ran the scheme for more than four years, fraudulently billing several of the nation’s top insurance companies — United, Aetna and Cigna — for $25 million and reaping about $4 million in cash.

In response to inquiries, Williams sent a brief handwritten letter. He didn’t deny billing the insurers and defended his work, calling it an “unprecedented and beneficial opportunity to help many people.”

“My objective was to create a system of preventative medicine,” he wrote. Because of his work, “hundreds of patients” got off their prescription medication and avoided surgery.

There are a host of reasons health care costs are out-of-control and routinely top American’s list of financial worries, from unnecessary treatment and high prices to waste and fraud. Most people assume their insurance companies are tightly controlling their health care dollars. Insurers themselves boast of this on their websites.

In 2017, private insurance spending hit $1.2 trillion, according to the federal government, yet no one tracks how much is lost to fraud. Some investigators and health care experts estimate that fraud eats up 10% of all health care spending, and they know schemes abound.

Williams’ case highlights an unsettling reality about the nation’s health insurance system: It is surprisingly easy for fraudsters to gain entry, and it is shockingly difficult to convince insurance companies to stop them.

Williams’ spree also lays bare the financial incentives that drive the system: Rising health care costs boost insurers’ profits. Policing criminals eats away at them. Ultimately, losses are passed on to their clients through higher premiums and out-of-pocket fees or reduced coverage.

Insurance companies “are more focused on their bottom line than ferreting out bad actors,” said Michael Elliott, former lead attorney for the Medicare Fraud Strike Force in North Texas.

As Lankford looked at the iPad that day, she knew something else that made Williams’ romp through the health care system all the more surprising. The personal trainer had already done jail time for a similar crime, and Lankford’s father had uncovered the scheme.

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Scanning her ex-husband’s texts, Lankford, then 47, knew just who to call. During the rocky end of her marriage, her dad had become the family watchdog. Jim Pratte has an MBA in finance and retired after a career selling computer hardware, but even the mention of Williams flushed his face red and ratcheted up his Texas twang. His former-son-in law is the reason he underwent firearms training.

Lankford lived a few minutes away from her parents in Mansfield. She brought her dad the iPad and they pored over message after message in which Williams assured clients that their insurance would cover their workouts at no cost to them.

Lankford and Pratte, then 68, were stunned at Williams’ audacity. They were sure the companies would quickly crackdown on what appeared to be a fraudulent scheme.

Especially because Williams had a criminal record.

In early 2006, while Williams and Lankford were going through their divorce, the family computer started freezing up. Lankford asked her dad to help her recover a document. Scrolling through the hard drive, Pratte came upon a folder named “Invoices,” and he suspected it had something to do with Williams.

His soon to be ex-son-in-law had had a promising start. He’d wrestled and earned bachelor’s and master’s degrees at Boise State University, and a Ph.D. at Texas A&M University, before landing a well-paying job as a community college professor in Arlington. But the glow faded when the school suddenly fired him for reasons hidden by a confidential settlement and by Williams himself, who refused to reveal them even to his wife.

Out of a job, Williams had hustled investments from their friends to convert an old Winn-Dixie grocery store into a health club called “Doc’s Gym.” The deal fell apart and everyone lost their money. The failure was written up in the local newspaper under the headline: “What’s up with Doc’s?”

Inside the “Invoices” folder, Pratte found about a dozen bills that appeared to be from a Fort Worth nonprofit organization where his daughter and Williams took their son Jake for autism treatment. As Pratte suspected, the invoices turned out to be fake. Williams had pretended to take Jake for therapy, then created the false bills so he could pocket a cash “reimbursement” from a county agency.

In November 2008, Williams pleaded guilty in Tarrant County District Court to felony theft. He was sentenced to 18 months in jail and was released on bail while he appealed.

Things took an even darker turn about two years later when Williams and Lankford’s 11-year-old son showed up to school with bruising on his face. Investigators determined that Williams had hit the boy in the face about 20 times. Williams pleaded guilty to causing bodily injury to a child, a felony, which, coupled with the bail violation, landed him in jail for about two years.

The time behind bars didn’t go to waste. Williams revised the business plan for Get Fit With Dave, concluding he needed to get access to health insurance.

Williams detailed his plans in letters to Steve Cosio, a tech-savvy friend who ran the Get Fit With Dave website in exchange for personal training sessions. Cosio, whose name later popped up on Lankford’s son’s iPad, kept the letters in their original envelopes and shared them with ProPublica. He said he never suspected Williams was doing anything illegal.

In his letters, Williams said that when he got out, instead of training clients himself, he would recruit clients and other trainers to run the sessions. “It has the potential for increased revenue.”

He asked Cosio to remove the term “personal training” from his website in another letter, adding “95 percent of my clients are paid for by insurance, which does not cover ‘personal training,’ I have to bill it as ‘therapeutic exercise.’ It is the same thing, but I have to play the insurance game … Insurance pays twice as much as cash pay so I have to go after that market.”

Williams downplayed his child abuse conviction — “I can honestly say that I am the only one in here for spanking their child” — and included a dig at his ex-father-in-law, Pratte: “an evil, evil man. He is the reason for my new accommodations.”

Williams told Cosio he needed to raise a quick $30,000 to pay an attorney to get him access to his children. “I will need to get a bunch of clients in a hurry.”

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To set his plan in motion, Williams needed what is essentially the key that unlocks access to health care dollars: a National Provider Identifier, or NPI number.

The ID number is little known outside the medical community but getting one through the federal government’s Medicare program is a rite of passage for medical professionals and organizations. Without it, they can’t bill insurers for their services.

One would think obtaining an NPI, with its stamp of legitimacy, would entail at least some basic vetting. But Williams discovered and exploited an astonishing loophole: Medicare doesn’t check NPI applications for accuracy — a process that should take mere minutes or, if automated, a millisecond. Instead, as one federal prosecutor later noted in court, Medicare “relies on the honesty of applicants.”

Records show Williams first applied for an NPI under his own name as far back as 2008. But it wasn’t until 2014 that Williams began to ramp up his scheme, even though now he wasn’t just unlicensed, he was a two-time felon. He got a second NPI under the company name, Kinesiology Specialists. The following year, he picked up another under Mansfield Therapy Associates. In 2016, he obtained at least 11 more, often for entities he created in the areas where he found fitness clients: Dallas, Nevada, North Texas and more. By 2017, he had 20 NPIs, each allowing him a new stream of billings.

For every NPI application, Williams also obtained a new employer identification number, which is used for tax purposes. But he never hid who he was, using his real name, address, phone number and email address on the applications. He added the title “Dr.” and listed his credentials as “PhD.” Under medical specialty he often indicated he was a “sports medicine” doctor and provided a license number, even though he wasn’t a physician and didn’t have a medical license.

Medicare officials declined to be interviewed about Williams. But in a statement, they acknowledged that the agency doesn’t verify whether an NPI applicant is a medical provider or has a criminal history. The agency claims it would need “explicit authority” from the Department of Health and Human Services to do so — and currently doesn’t have it. Regulations, and potentially the law, would need to be revised to allow the agency to vet the applications, the statement said.

Medicare does verify the credentials of physicians and other medical providers who want to bill the agency for their Medicare patients.

To those charged with rooting out fraudsters, the current regulations seem like an invitation to plunder.

“Medicare has to make sure that the individuals who apply for NPIs are licensed physicians — it’s that simple,” said Elliott, the former prosecutor who ran about 100 health care fraud investigations.

Elliott, who now does white-collar criminal defense, said he knows of two other cases currently under federal investigation in which non-licensed clinic administrators lied to obtain NPI numbers, then used patients’ information to file false claims worth millions.

Medicare warns NPI applicants that submitting false information could lead to a $250,000 fine and five years in prison. But since Medicare started issuing NPIs in 2006, officials said they could not identify anyone who had been sanctioned.

So, for those bent on fraud, the first step is easy; the online approval for an NPI takes just minutes.

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Williams got out of jail in November 2012 and launched an aggressive expansion with an irresistible pitch: Time to get those private personal training sessions you thought you couldn’t afford!

“Now accepting most health insurance plans,” his Get Fit With Dave website announced. He added a drop-down menu to his site, allowing potential clients to select their health insurance provider: Aetna. Blue Cross Blue Shield. United.

He began building a team, soliciting trainers from the strength and conditioning department at Texas Christian University. He met with new recruits at local fast food joints or coffee shops to set them up. To the trainers, the business appeared legit: They even signed tax forms. Before long, Williams’ network stretched throughout Texas and into Colorado, Idaho and Nevada.

One Fort Worth trainer recalled meeting Williams through one of his clients, a Southwest Airlines flight attendant. Williams, he said, seemed like a real doctor, and it wasn’t hard to imagine an insurer’s wellness program covering fitness. Plus, it was good money — about $50 an hour and Williams paid him for multiple clients at once if he did boot camps, said the trainer, who asked that his name not be used so he wouldn’t be tarnished by his association with Williams. Williams, he said, even gave him an iPad, with “Kinesiology Specialists” etched on the back, to submit bills and paid him via direct deposit.

Clients came to Williams through his business cards, his website and word-of-mouth. Williams, records show, quickly verified if their insurance companies would cover his fees — although he didn’t tell clients that those fees would be billed as medical services, not personal training. To ensure the clients paid nothing, he waived their annual deductibles — the portion patients pay each year before insurance kicks in. Authorities said Williams banked on being able to file enough claims to quickly blow through their deductibles so he could get paid.

Meredith Glavin, a flight attendant with Southwest, told the authorities she got in touch with Williams after her co-workers said insurance was covering their workouts. After providing her name, address and insurance information on the Get Fit With Dave website, Williams emailed back with the good news: “Everything checks out with your insurance. My services will be covered at no cost to you.”

During a follow-up phone call, Glavin said, they discussed her fitness and weight loss goals and then Williams connected her with a trainer. The workouts were typical fitness exercises, she said, not treatment for a medical condition. But insurance claims show Williams billed the sessions as highly complex $300 examinations to treat “lumbago and sciatica,” a condition in which nerve pain radiates from the lower back into the legs.

He used his favorite billing code — 99215 — to bill Glavin’s insurer, United, the claims show. The code is supposed to be used less often because it requires a comprehensive examination and sophisticated medical decision-making, warranting higher reimbursement. In all, Williams used the code to bill United for more than $20.5 million — without apparently triggering any red flags at the insurer. For that code alone, the insurance giant rewarded him with $2.5 million in payments.

Eventually, Get Fit With Dave expanded to about a dozen trainers and around 1,000 patients, said a source familiar with the case. And, court records show, the checks from insurance companies, some over $100,000, kept rolling in.

Williams bought a couple of pick-up trucks, a new Harley Davidson motorcycle and a fancy house. But greed didn’t seem his only motivation. “I made $50K last week,” he wrote in a December 2014 text to a friend. “Seriously it means nothing. It is not about the money. I have had a lot taken away from me, and maybe I am trying to prove something ... Maybe it is my way of giving the finger to everyone???”

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A few miles away, his former father-in-law watched Williams’ illegal business blossom with growing outrage. Pratte kept his grandson’s iPad on his desk, near his computer, and checked it every day. The texts appeared boring, even routine, but Pratte knew they were evidence of ongoing fraud.

“I have another flight attendant friend who is interested in signing up as well,” a new client texted to Williams.

“Tell him to show up with his insurance card,” Williams replied.

To Pratte, the text messages were a “gold mine.” This is the stuff that will really nail his rear end, he recalled thinking as he read the messages. He couldn’t wait to share his findings with the insurers. How often do they get cases wrapped up in a bow?

But when he and Lankford began contacting insurers, they were soon bewildered. When Pratte told Aetna that he wanted to report a case of fraud, he said the customer service representative asked for his member number, then told him non-members couldn’t report criminal activity. Lankford, who happened to be covered by Aetna, made the complaint, but they say they never heard back.

An Aetna spokesman told ProPublica that the insurer could find no record of Pratte’s call but said the company’s fraud hotline takes tips from anyone, even anonymous callers.

Lankford sent an email to Cigna’s special investigations unit in January 2015 “regarding one of your providers that concerns me.” She provided Williams’ company name, address, cellphone number, Social Security number and more, and she described his scheme. “He has no medical license or credentials,” she wrote. “He was in prison for felony theft.”

A supervisory investigator called to ask for the names of personal trainers, which Lankford provided. But, again, there was silence.

Pratte could see many of the clients worked for Southwest and had their benefits administered by United. He jotted down the name, address, phone number, birthdate and member identification number of the potential clients on a yellow legal pad — all the information the insurer and Southwest would need to investigate the fraud. This is so easy, Pratte recalled thinking as he wrote down the details, all they have to do is cross-reference this.

Because Southwest self-funds its benefits, the company was on the hook for the bills, which would eventually total about $2.1 million according to a source familiar with the case. It paid United to administer the company’s plan and ensure the claims it covered were legitimate. Pratte said he called the airline in the fall of 2015 and spoke to someone in the human resources department who said they would pass the information to the right people. “That was the last I heard,” he said. Southwest declined to comment for this story. It still pays United to administer its benefits.

Pratte started calling United in the fall of 2014 and spoke to a fraud investigator who took the information with interest, he said. But within a couple of weeks he was told she moved to a different position. Pratte continued calling United over the following two years, making about a dozen calls in total, he said. “He is not a doctor,” Pratte told whoever picked up the phone. “So, I don’t see how he can be filing claims.”

In early 2015, Lankford emailed additional information to the investigator. The investigator wrote back, thanking Lankford and saying she forwarded the details to the people who research licenses. “They will investigate further,” she said in the email.

Meanwhile, the text messages showed Williams continuing to sign up — and bill for — United members.

Frustrated, Pratte made one final call to United in 2016, but he was told the case was closed. United said he’d have to call the Texas Department of Insurance for any additional details. Pratte had already filed a complaint with the regulator but reached out again. The department told him that because he hadn’t personally been defrauded, it would not be able to act on his complaint.

To Pratte, it appeared he had struck out with Aetna, United, Southwest and the Texas Department of Insurance. “I was trying to get as many people as possible to look into it as I could,” Pratte said recently. “I don’t know if that tells me they are incompetent. Or they don’t care. Or they’re too busy.”

A case summary, prepared by the Texas Department of Insurance, shows it first learned of the Williams case in January 2015 but lacked staff to investigate. A spokesman said the regulator later received Pratte’s complaint but didn’t pursue it after learning that United had already investigated and closed its case.

Meanwhile, some Get Fit With Dave clients had begun noticing odd claims on their insurance statements.

Nanette Bishop had heard about Williams when a fellow Southwest flight attendant handed her the trainer’s business card and said, “You’ve got to meet Dr. Dave.” (Bishop said the Southwest legal department advised her not to speak with ProPublica. Details about her interaction with Williams come from court records.)

Bishop said she started strong with the workouts but “fizzled” quickly. Her daughter, who was also on her plan and signed up for workouts, only did a couple sessions. Bishop said she had a hard time staying consistent because she was traveling a lot — for much of October 2014 she was in Germany. Later, she noticed in her insurance records that Williams had been paid for dozens of sessions over many months, even during the time she’d been abroad.

Bishop texted Williams in January 2015 to tell him he needed to refund all the money. “I never worked out four [times] a week and [my daughter] quit the first week of September,” she wrote. Bishop also called United and Southwest Airlines to report the overbilling.

About a month later, Williams received a letter from a subsidiary of United ordering a review Bishop’s medical records.

Another client texted Williams with concerns that her United insurance plan had been billed for 18 workouts in December 2015. That couldn’t be accurate, the woman wrote. “I had to take December off due to my work schedule and family in town,” she wrote. “I understand that people need to be paid but this seems excessive.”

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While Pratte, Lankford and some of Williams’ clients repeatedly flagged bogus bills, the mammoth health insurers reacted with sloth-like urgency to the warnings. Their correspondence shows an almost palpable disinterest in taking decisive action — even while acknowledging Williams was fraudulently billing them.

Cigna appears to have been the quickest to intervene. In January 2015, Cigna sent Williams a letter, noting that he wasn’t a licensed medical provider and had misrepresented the services he provided. The insurer said he needed to pay back $175,528 and would not be allowed to continue billing.

“I just got a $175K bill in the mail,” Williams texted to a friend. “Cigna insurance has been overpaying me for the past 18 months and they want it back. I knew that they were reimbursing at too high of a rate so I can’t really complain.”

By then Williams had more than one National Provider Identifier, so he just switched numbers and kept billing Cigna. More than a year later, in May 2016, Cigna sent another letter, saying he now owed $310,309 for inappropriate payments. In total, the company paid him more than $323,000. Williams never gave any of it back. Cigna declined to comment about the Williams case.

Aetna wrote Williams in January 2015 to say it had reviewed his claims and found he wasn’t licensed, resulting in an overpayment of $337,933. The letter said there appeared to be “abusive billing” that gave “rise to a reasonable suspicion of fraud.” But the insurer also gave him a month to provide documentation to dispute the assessment. When Williams hadn’t responded in three months, an Aetna investigator wrote to Williams’ attorney, saying, “We are willing to discuss an amicable resolution of this matter,” and gave him two more weeks to respond.

That August, an Aetna attorney sent Williams’ attorney another letter, noting that Williams had submitted “fraudulent claims” and had continued to submit bills “even after his billing misconduct was identified.”

In January 2016 — a year after Aetna first contacted him — Williams agreed to a settlement that required him to refund the company $240,000 “without admission of fault or liability by either party.”

But that didn’t stop, or even appear to slow, Williams. Not only did he renege on that promise, he picked one of his other NPI numbers and continued to file claims resulting in another $300,000 in payments from Aetna. In total, Aetna paid Williams more than $608,000.

In emails, Ethan Slavin, a company spokesman, didn’t explain why Aetna settled with Williams instead of pursuing criminal prosecution. He blamed the insurer’s slow response on the lengthy settlement process and Williams’ tactic of billing under different organizations and tax identification numbers. Williams did repay some of the money before defaulting, Slavin said.

United, one of the largest companies in the country, paid out the most to Williams. The insurer brought in $226 billion last year and has a subsidiary, Optum, devoted to digging out fraud, even for other insurers. But that prowess is not reflected in its dealings with Williams.

In September 2015, United wrote to Williams, noting his lack of a license and the resulting wrongful payments, totaling $636,637. But then the insurer added a baffling condition: If Williams didn’t respond, United would pay itself back out of his “future payments.” So while demanding repayment because Williams was not a doctor, the company warned it would dock future claims he would be making as a doctor.

Williams responded a month later, noting that he had a Ph.D. in kinesiology and did rehab, so he met the qualifications of a sports medicine doctor.

United responded in November 2015 with the same argument: he wasn’t licensed and thus needed to repay the money, again warning that if he didn’t, United would “initiate repayment by offsetting future payments.”

Williams took United up on its offer. “Please offset future payments until the requested refund amount is met,” he responded.

Then Williams turned to another NPI number, records show, and continued submitting claims to United.

In January 2016, Williams agreed to settle with United and repay $630,000 in monthly installments of $10,000. Inexplicably, the agreement refers to Williams as “a provider of medical services or products licensed as appropriate under the laws of the state of TX” and notes that the settlement doesn’t terminate his continued participation in United’s programs.

In 2016, Williams obtained a new batch of NPI numbers from Medicare. As usual, he used his real name, address and credentials on the applications. The additional numbers allowed him to continue to make claims to United.

In November 2016, United investigators caught Williams again — twice. They sent two letters accusing him of filing 820 claims between May 2016 and August 2016 and demanded repayment. Again, almost inconceivably, the company threatened to cover his debt with “future payments.”

In December 2016, United notified Williams he had only repaid $90,000 of the initial $630,000 he owed and was in default. The following month, United told him he had to pay the remaining $540,000 within 20 days or he could face legal action. Williams replied, saying he wanted to renegotiate the settlement, but the insurer declined. Late that month, United said its inappropriate payments to Williams had ballooned to more than $2.3 million.

A United spokeswoman said it was difficult to stop Williams because he used variations on his name and different organizations to perpetrate the fraud. “He did everything he could not to get caught,” Maria Gordon-Shydlo said.

She acknowledged getting the complaints from Lankford and Pratte, as well as United members, but defended the response of the company, saying it had eventually referred Williams to law enforcement.

The insurer is continuing “to improve our processes and enhance our systems so we can catch these schemes on the front-end,” she said, “before a claim is paid and to recoup dollars that were paid as a result of provider misconduct.”

In all, United paid Williams more than $3.2 million — most of it after the insurer had caught him in the act.

But in reality, the losses weren’t all United’s. Most of the fraud was funded by its client, Southwest.

---

Many health care experts and fraud investigators said they weren’t surprised to hear that insurers were slow to stop even such an outlandish case of fraud.

“It’s just not worth it to them,” said Dr. Eric Bricker, an internist who spent years running a company that advised employers who self-funded their insurance.

For insurance behemoths pulling in billions, or hundreds of billions, in revenue, fraud that sucks away mere millions is not even a rounding error, he said.

And perhaps counterintuitively, insurance companies are loath to offend physicians and hospitals in their all-important networks — even those accused of wrongdoing, many experts have said. They attract new clients by providing access to their networks.

This ambivalence toward fraud, Bricker and others said, is no secret. Scammers like Williams are “emblematic of gazillions of people doing variants of the same thing,” Bricker said. Insurers embolden them by using a catch-and-release approach to fraud, in which the insurers identify criminals, then let them go.

Joe Christensen has pursued fraud for both government and commercial insurers, serving as a director in Aetna’s Special Investigations Unit, a team of more than 100 people ferreting out fraud, from 2013 to 2018 and as the director of Utah’s insurance fraud division for 13 years. Fraud in government programs, like Medicare and Medicaid, gets more publicity, he said, and has dedicated arms of agencies pursuing fraudsters. But the losses may be even greater in the commercial market because the dollar levels are higher, he said.

Some commercial insurers take a passive approach, Christensen said, in part because it’s expensive to press a fraud case. At Aetna, he said, investigators would identify cases of apparent fraud, but it was up to the executives and legal team to decide how to handle them. Taking fraudsters to civil or criminal court requires resources, so the company often settled for trying to get repaid through settlements or blocking a suspect provider from billing, he said.

Christensen said while he was at Aetna, investigators almost never sought to partner with law enforcement agencies to pursue criminal cases. Last spring, he became the SIU director for a Southern California-based Medicaid plan called L.A. Care Health Plan, where he was allowed to take a proactive approach. In just about a year, he said, his much smaller team began 37 criminal investigations with law enforcement agencies. The cases are in different stages, but so far there have been seven arrests, four search warrants and one conviction. Christensen recently took a job with an insurer in Utah, where his family lives, so he could be closer to them.

ProPublica asked Aetna how many criminal cases it had pursued in 2017 and 2018. A company official said the question could not be answered because it does not track such cases.

---

In the spring of 2017, more than four years after Williams first began billing insurers, one of them, United, finally brought him to the attention of the FBI’s heath care fraud squad.

One May day, agents from the FBI and the newly engaged Texas Department of Insurance knocked on the door of Williams’ sprawling six-bedroom home — a spread he’d boasted to one trainer that he’d purchased with cash. Williams didn’t invite them in. He refused to answer questions, claiming his attorney had dealt with the questionable billings.

Undaunted, just days later, Williams used a freshly minted NPI number to send another bill to United. The last known claim he submitted was on June 3, 2017, according to a source familiar with the investigation.

That October, Williams’ long run came to an end when he was arrested by the FBI.

The following May, Williams’ trial began in the United States District Court for the Northern District of Texas. The prosecution didn’t have to make a complex argument. Williams had billed for non-medically necessary services and wasn’t a medical provider — a “slam dunk case” said the agent on the case.

But the testimony served as a cheat sheet for how to defraud the health insurance industry and mostly get away with it.

Without irony, the prosecutor, P.J. Meitl, argued that Williams had preyed on a health insurance system that relies “on trust, relies on honesty” when it pays claims.

He called fraud investigators from Aetna, Cigna and United, who testified that their companies auto-pay millions of claims a year. It’s not cost effective to check them, they said. “Aetna relies on the honesty of the person submitting the claim verifying that it’s true,” testified Kathy Richer, a supervisor in Aetna’s Special Investigations Unit.

In a similar manner, Medicare trusts that people who apply for NPI numbers are actually medical providers, Meitl told the jury. Medicare “does not investigate or verify whether an individual is actually a health care provider before issuing an NPI number.”

Williams’ attorney, Wes Ball, argued that the case was the sign of a “broken” health care system and blamed insurers for making a financial decision not to review Williams’ claims before paying them. United failed to protect Southwest’s money, Ball said, and “might be a vendor you might not want to hire.”

As for the NPI numbers, anyone could have checked Williams’ credentials, he said.

The jury wasn’t convinced, convicting Williams of four counts of health care fraud.

The judge sentenced him to a little more than nine years in federal prison and ordered him to pay $3.9 million in restitution to United, Aetna and Cigna.

---

Insurers promote themselves as guardians of health care dollars. United says on its website it wants to “help employers manage” medical expenses, resulting in “lower costs.” Aetna promises employers “affordability.” Cigna promises “increased savings.”

But private health insurers allow so much fraud that prosecutors use an idiom to describe the rare person who gets caught: “Pigs get fat, hogs get slaughtered.”

“Pigs” can steal millions, if they bill just enough to avoid notice. But if they get greedy and bill too many millions, they “become a data outlier,” said Elliott, the former fraud task force prosecutor. “You get slaughtered.”

Williams took years to reach hog status.

Part of the problem, experts say, is that health care fraud is often misunderstood as shafting greedy insurers — not the folks paying for health insurance. Ultimately, insurers don’t bear the cost. For their self-funded clients, like Southwest, they merely process the claims. For their traditionally insured clients, they can recover any losses by increasing deductibles and premiums and decreasing coverage.

Williams appears to have duped more than insurers. His twin brother, Dan Williams, recently retired as the assistant special agent in charge of the Dallas field office for criminal investigation for the Internal Revenue Service. He spent 27 years ferreting out fraud, and he gets the irony. “You’re not the first person to point that out,” he said.

Dan Williams said his brother’s sudden riches from the training business piqued his investigative instincts, but he “trusted” his brother when “he told me he was authorized to bill insurance companies.”

In his letter to ProPublica, Williams did not address the issues in the case or even acknowledge that any of his activities were wrong. Instead, he blamed his former wife.

“It grieves me that the consequences of a bitter and hurtful divorce have resulted in the ending of this unprecedented and beneficial opportunity to help many people,” he wrote.

Lankford and Pratte are proud of their part in ending his scheme, if still baffled that they had to play such a central role in uncovering it.

If it hadn’t been for the iPad messages, “I have to believe he would still be billing insurance companies from a Caribbean island,” Pratte said.

Have you worked in health insurance or employer-sponsored health benefits? ProPublica is investigating the industry and wants to hear from you. Please complete our brief questionnaire.
 

https://www.propublica.org/article/health-insurers-make-it-easy-for-scammers-to-steal-millions-who-pays-you?utm_source=pardot&utm_medium=email&utm_campaign=majorinvestigations 

Sanders and Biden Fight Over Health Care, and It’s Personal

By Sydney Ember and Katie Glueck - NYT - July 18, 2019

WASHINGTON — Senator Bernie Sanders does not understand Joseph R. Biden Jr.’s position on health care. To Mr. Sanders, the health care system is broken, and the only way to fix it is to replace it with his signature policy plan known as Medicare for All.
“I am disappointed, I have to say, in Joe, who is a friend of mine, really distorting what Medicare for All is about,” Mr. Sanders said in an interview hours before he delivered a speech on Wednesday defending his health care proposal. “And unfortunately, he is sounding like Donald Trump. He is sounding like the health care industry in that regard.”
To Mr. Biden, the current Democratic front-runner, Medicare for All is a costly and complex proposal that means eliminating private health insurance — and scrapping the Affordable Care Act.
“I knew the Republicans would do everything in their power to repeal Obamacare,” he said in a video this week as he rolled out his own health care proposal. “They still are. But I’m surprised that so many Democrats are running on getting rid of it.”

After months of warily watching each other from afar, Mr. Sanders and Mr. Biden, two Democratic septuagenarian contenders for president, have taken aim at each other on the fraught and critical battleground of American health care policy.
Mr. Sanders in particular has escalated the attacks in recent days. His campaign called Mr. Biden’s health care plan “Bidencare” and even released a video that accuses him of “lying” about Medicare for All. But Mr. Biden, too, has been a more-than-willing participant, openly criticizing Medicare for All on multiple campaign swings over the last week.
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Their sparring reflects strategic political calculations. For Mr. Biden, who appears increasingly willing to draw contrasts with his Democratic rivals after a rocky first presidential debate, health care provides a way to highlight distinctions between himself and several opponents who support Medicare for All, including Mr. Sanders and Senators Kamala Harris and Elizabeth Warren.
For Mr. Sanders, outraised by several rivals including Ms. Warren and falling in some polls, Medicare for All — which he has preached for decades — offers a possible path back to the center of the national political conversation.
But there is more to their jousting than just normal campaign maneuvering. Health care is a personal issue for both men — to Mr. Sanders, it is a fundamental human right and embodies his lifelong message of economic equality. To Mr. Biden, who was vice president to Barack Obama when the Affordable Care Act was passed, it is also connected to the death of his son Beau Biden, who died after a battle with brain cancer.

Politically, polls show that health care is a top priority for Democrats, and an emphasis on protecting people with pre-existing conditions and reducing health care costs helped Democrats in last year’s midterms when they picked up 40 seats in the House. With Mr. Trump and Republicans repeatedly threatening to unravel Obamacare, Democrats hope that the issue of health care will again work in their favor.
If Mr. Sanders and Mr. Biden have both seemed at times to relish the debate, it has also thrown into sharp relief two competing visions for the Democratic Party.
Mr. Biden embraces fixes to the health care system and the addition of a public option, rather than a full-scale overhaul, portraying that approach as more pragmatic in today’s fractured political landscape, to say nothing of appealing to a nostalgia for the Obama era. The other view, championed by Mr. Sanders and others on the left, is that the nation’s challenges are so significant that only the boldest, most transformational proposals will do.
The philosophical clash erupted on Wednesday when Mr. Sanders delivered a formal address in Washington on the merits of replacing the current health care system with Medicare for All, saying his plan would “save lives” and urging presidential candidates to reject contributions from the health care industry.
Though he did not mention Mr. Biden by name, he took several veiled swipes at him, joking about how much Americans love their private insurance (they do not, Mr. Sanders claimed, though polls tell a more complicated story) and about how they love paying their insurance premiums (ditto).

Senator Bernie Sanders announced his Medicare for All plan in Washington on Wednesday.CreditSamuel Corum for The New York Times

It was a conflict that had been simmering for days.
Last week, Mr. Biden told reporters in Portsmouth, N.H., that Medicare for All is not “Medicare as you know it.”

“It is one that I think is going to be difficult to pass, No. 1,” he said. “But No. 2, I think people should be able to be in a situation, if they want to keep their employer-based insurance, they should be able to do it.”
Though Mr. Biden said that Mr. Sanders had been “very honest” about the costs of Medicare for All, he still drew a forceful rebuke from the Vermont senator, who accused Mr. Biden of echoing the insurance and pharmaceutical industries — and Republicans — in his criticisms of Medicare for All.
And on Monday, Mr. Sanders blasted Mr. Biden’s health care plan, suggesting it was aligned with “corporate greed.”
Aides to Mr. Sanders suggest the escalating confrontation plays into his hands: They have been trying to frame the primary as a competition between him and Mr. Biden, hoping to set up the same kind of insurgent-versus-establishment contrast that worked to Mr. Sanders’s advantage in 2016, when he was the foil to Hillary Clinton. And they view poaching supporters from Mr. Biden, particularly working-class Democrats, as the most promising way for Mr. Sanders to grow his base.
To help their case, they have been urging Mr. Sanders to go after Mr. Biden more aggressively.
Yet for weeks, they have remained frustrated with polls showing Mr. Biden still leading Mr. Sanders by comfortable margins, some allies said. The recent surges by Ms. Warren and Ms. Harris and the fund-raising prowess of Mayor Pete Buttigieg have also dispelled the notion that it is a two-person contest.
“He’s clearly losing support, both in the national polls and in states,” Stan Greenberg, a veteran Democratic pollster, said of Mr. Sanders. “He has no choice. I think he’s made a decision, he’s got to make himself relevant again. Health care was the issue in which he was relevant last time, and it was very important in the campaign in 2016, so I think it makes a lot of sense for him to try to draw this contrast on health care, particularly in the primary.”
Mark Longabaugh, who was one of Mr. Sanders’s top advisers in 2016 but left the 2020 team this year, said Mr. Sanders was “really good in a contrast.”

But he cautioned that the senator would be ill-advised to discount his other opponents at this point.
“You’ve got obviously several other significant candidates and actors in this thing,” he said. “I just don’t see this election turning into a Biden-versus-Bernie race.”
Mr. Biden’s allies point to the current political realities in Washington — which includes a Republican-controlled Senate — as evidence that passing a sweeping overhaul of the nation’s health care system would be exceedingly difficult, and argue that Mr. Biden’s proposal is more realistic.
“I’m not so sure anyone believes Americans are ready to go through a wholesale change in the health care system,” said John Anzalone, a Biden pollster. “Joe Biden is approaching this as, people are hurting, what can we do now, or in the very near future, when a Democrat is president?”
In a separate interview over the weekend with The New York Times, Mr. Sanders appeared to acknowledge the steep political requirements of his proposal, saying “a Democratic Senate is certainly absolutely imperative if we’re going to go forward,” and added that members on both sides of the aisle would have to come together to create “a system which is designed not to provide huge profits for the drug companies and the insurance companies but quality care to all people.”
As the battle over health care continues, even Mr. Sanders’s advisers are no longer hiding their distaste for Mr. Biden’s criticisms.
“This campaign will not be a punching bag for misinformation out of the Biden campaign,” said Jeff Weaver, Mr. Sanders’s 2016 campaign manager and his closest adviser.
Referring to the last presidential contest, he added, “If people want to go into the general election in 2020 with a candidate with the same set of policy prescriptions as 2016, that’s a real roll of the dice.”
https://www.nytimes.com/2019/07/18/us/politics/sanders-biden-health-care.html?action=click&module=News&pgtype=Homepage

Why the House plans to pass a bipartisan bill repealing a controversial Obamacare tax

The Cadillac tax is on the chopping block.

by Tara Golshan - VOX - July 17, 2019 

The House of Representatives is about to pass a bipartisan health care and tax bill Wednesday to get rid of a long-hated part of the Affordable Care Act: the “Cadillac tax.”

The Cadillac tax levies a 40 percent tax on the most expensive employer-sponsored health insurance plans, those worth about $11,200 for individuals and $30,100 for families, starting in 2022. The tax on businesses would hit the part of the plan above the price threshold. It was supposed to go into effect in 2018 at a lower price threshold, but was delayed. Repealing the tax would cost the United States an estimated $197 billion over 10 years, according to an analysis by the Joint Committee on Taxation.

The House bill, the Middle Class Health Benefits Tax Repeal Act of 2019, has more than 350 co-sponsors and is expected to pass with bipartisan support. While Senate Republicans have shown interest in the bill, it’s not clear whether Senate Majority Leader Mitch McConnell will bring the bill up for a vote.

The Cadillac tax has been a controversial provision in Obamacare from the beginning — and almost by design. Its passage resulted in some strange ideological bedfellows. In 2008, John McCain campaigned on it. Obama’s advisers endorsed it. Sen. Marco Rubio included a Cadillac tax in his 2015 Obamacare repeal proposal. But in the 2016 presidential election, both Hillary Clinton and Sen. Bernie Sanders called to repeal it. Advocates for repealing the Cadillac tax include conservative chambers of commerce and big business.

But the issue remains divisive among Democrats and Republicans, even within their own parties.

The Cadillac tax was always controversial — and unpopular

The point of this tax was to encourage employers to offer less expensive health insurance. Sarah Kliff explained why for Vox in 2015:

Traditionally, the government doesn’t tax employer-sponsored insurance. This has created a huge incentive for companies to spend more money on generous insurance plans and less on cash wages. This, in turn, pushes up health-care costs across the system. When workers have expensive plans with no copays or deductibles, they’re likely to use lots of health care, including trips to the doctor they don’t really need.

The economists and policy advisers under the Obama administration who supported the Cadillac tax argued that by encouraging companies to scale back insurance benefits, businesses would in turn give employees a wage increase (there’s some evidence that could happen). And, they said, it would only hit the wealthiest executives, most generous union plans, and major companies (which there’s not much evidence to support).

At the end of the day, the Cadillac tax was literally designed to encourage companies to make insurance plans worse. Not necessarily terrible — but just to reduce benefits and control costs.

“The Cadillac tax is one of the most important tools we have to control health care cost growth in the private sector,” the Committee for a Responsible Federal Budget, a deficit reduction think tank, said in a statement. “Repealing it will drive up health care costs while adding more than $1.2 trillion to the debt over the next two decades and reducing wages by trillions over that time period.”

That said, according to a 2018 study by the Kaiser Family Foundation, increases in deductibles for insured workers have outpaced any real wage increases for employees. So it makes sense that both businesses that would have to pay the tax and labor unions who negotiate generous health benefits for their members argued against it.

The Cadillac tax had some fundamental flaws

Advocates for the tax’s repeal point out a few fundamental problems with it.

First, it’s not just rich corporate bosses getting robust health care package; it’s teachers, state workers, and other employees who aren’t necessarily ultra-high earners. As Kliff writes that the Cadillac tax is a “blunt instrument”:

There’s no adjustment, for example, for people who live in places where health care is really expensive — so the threshold is the same in the Midwest, where health insurance is pretty cheap, as it is in remote states like Alaska, where it’s more expensive to deliver health care. It’s the same for teachers as it is for bankers, for someone who has a chronic disease that really does require many doctor visits and for someone who is perfectly healthy.

Second, the way the tax is set up means it could affect more and more plans down the line. As written, the price threshold under the Cadillac tax rises with the rate of inflation. So in 2022, an analysis by the Kaiser Family Foundation found, 21 percent of employers would face the tax. But by 2030, 46 percent of employers would be hit.

That’s because health care costs typically grow faster than the economy. While in 2017, health care spending grew at nearly the same rate as the economy, last year the government projected that health care spending would rise by an average of about 1 percentage point faster than economic growth annually through 2026.

That means that down the road the Cadillac tax would no longer be on just the most expensive plans. It would hit much more than that.

https://www.vox.com/2019/7/17/20697690/house-bipartisan-bill-repeal-obamacare-cadillac-tax 

Blue Cross’s approach to paying doctors based on quality of care shows results, Harvard study finds - The Boston Globe

by Shirley Leung - Boston Globe - July 18, 2019

The study published Thursday in the New England Journal of Medicine is the longest evaluation to date of this type of payment model. With eight years of data, it adds to the body of evidence that suggests changing incentives for doctors and hospitals could moderate costs.

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Rising health care costs are a perpetual concern in Massachusetts and across the country, and many experts believe spending growth will not let up unless the payment system changes.
“This contributes to a growing sense that smarter ways of paying for health care are going be to an important part of the solution to rising health care costs,” said Katherine Baicker, dean of the University of Chicago Harris School of Public Policy, who was not involved in the study.
Doctors and hospitals traditionally have been rewarded for every test, procedure, and service they provide, regardless of whether those things help patients get healthier.
Blue Cross’s payment program, called the Alternative Quality Contract, has been closely watched since it began in 2009. Other insurers, including Harvard Pilgrim Health Care and Tufts Health Plan, have since launched similar programs.
The federal government has also pushed new payment plans in Medicare through accountable care organizations: groups of doctors and hospitals that work together to coordinate care for patients. And in Massachusetts, the Medicaid program for low-income individuals is in the midst of similar changes.
The programs all share two lofty goals: improve patient health and slash costs.
The Harvard study shows that spending increased for patients in the experimental Blue Cross program — but it grew more gradually than spending for other patients. The savings may be too modest for patients to notice in their health care premiums, which generally continue to rise.
The program was linked to an average 12 percent savings on medical claims over eight years. Some of the savings came when patients shifted their medical care to less expensive facilities. Costs also moderated because patients used fewer services; for example, they received fewer expensive MRIs and visited hospital emergency departments less frequently.
At the same time, the quality of care they received stayed steady or improved, said Dr. Zirui Song, the study’s lead author. Quality was calculated through a variety of measures, including whether patients received the proper cancer screenings, and whether they maintained a healthy blood pressure.
Song said his analysis shows that alternative payment programs are sustainable over several years. But he cautioned, “Behavior change is difficult, and sustaining behavior change is even more difficult.”
The study, funded by the National Institutes of Health, was welcomed by executives at Blue Cross, Massachusetts’ largest private health insurer.
“For so many years, the health care field was really paralyzed by the belief that controlling costs would actually harm quality,” Blue Cross chief executive Andrew Dreyfus said. “What this study again reinforces is with the proper incentives, you can control costs and improve quality.”
The Blue Cross program and others like it differ from earlier experiments in payment reform because of their emphasis on quality measures. Blue Cross requires doctors to score well on dozens of different measures before they can earn bonuses.
In the 1980s and 1990s, “there were concerns about doing too few things — like people would not do a cardiac bypass procedure because it would be too expensive,” said Dr. Steven Strongwater, chief executive of the physician group Atrius Health. “What these measures have done is erase that risk, by virtue of the fact that you’re measuring outcomes.”
The Blue Cross program gives doctors special funds to invest in care management. Atrius — among the first medical groups to join the Blue Cross program — used some of that money to hire new care managers who worked with patients to control their blood pressure. In 2009, 65 percent of Atrius patients had blood pressure in a healthy range. A decade later, that has grown to 85 percent.
Meanwhile, Atrius — which includes Harvard Vanguard and other physician practices — is also working to save money by moving common surgeries, such as joint replacements, from hospitals to ambulatory surgery centers.
Alternative payment programs account for about 41 percent of patients with private insurance in Massachusetts, according to state data. The popularity of these programs varies in other states, and nationally, the traditional fee-for-service payment system remains the norm.
Massachusetts has been more aggressive than other states in taking on health care costs. It set a target — 3.6 percent — for controlling annual increases in total statewide health spending. It also created a new watchdog agency, the Health Policy Commission.
In 2017, the most recent year for which figures are available, total health care spending in Massachusetts increased 1.6 percent — the lowest level in five years — even though costs remained a burden for many patients.
Dr. David Blumenthal, president of the New York-based Commonwealth Fund, a nonprofit that does health policy research, said the Harvard study demonstrates that payment reform is a critical piece of the strategy to control costs.
“We generally don’t give experiments in health system reform enough time to prove themselves,” Blumenthal added. “This is an eight-year study, which is unusually long for a social experiment. It shows we may have to wait a certain amount of time to reach judgment in the experiments we launch.”
https://www.bostonglobe.com/business/2019/07/18/blue-cross-approach-paying-doctors-based-quality-care-shows-results-harvard-study-finds/wf4GBM1Giro2OevOyZCr0M/story.html?