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.”
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.
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. 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.
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.”
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
“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
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
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.
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.
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.
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 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.
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.
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.)
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
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.
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:
:no_upscale()/cdn.vox-cdn.com/uploads/chorus_asset/file/18330511/Screen_Shot_2019_07_23_at_2.49.03_PM.png)
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?
:no_upscale()/cdn.vox-cdn.com/uploads/chorus_asset/file/18330525/Screen_Shot_2019_07_23_at_4.41.41_PM.png)
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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.
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§ion=Health
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