Health Care Reform Articles - September 8, 2019

Medicare-for-All Is Not Medicare, and Not Really for All. So What Does It Actually Mean?
by Akilah Johnson - Pro Publica - September 6, 2019

GAITHERSBURG, Md. — Ritchard Jenkins reached into the black computer bag he keeps near his workstation at Graceful Touch Barber and Beauty Salon and rifled through medical papers, pulling out an envelope buried deep at the bottom.

It was an unopened medical bill for $971.78, now 17 months overdue, that he had put out of sight and out of mind. Another unpaid bill from May for $447.13 rested in a nearby drawer. Both are the result of an arthritic knee that needs to be replaced and keeps the 55-year-old master barber in near-constant pain.

He makes numerous phone calls to doctors and insurance companies to discuss his coverage. And just when he thought he couldn’t take any more, he fell down the steps, breaking his right wrist, tearing his rotator cuff and kickstarting a new round of hospital stays, tests — and insurance claims.

“Health care is ridiculous. These politicians really need to step their game up,” Jenkins said recently, using his left hand to hold clippers and a comb because his right remains swollen and partially immobile.

But Jenkins shrugged when asked if Medicare-for-all, the slogan that has dominated early campaigning in the 2020 Democratic primary, was the solution to his and America’s health care woes. He mumbled something about being too young for Medicare and laid bare the disconnect between how voters think and talk about health care and how candidates do.

Jenkins uses clippers with his swollen right hand. (Gabriella Demczuk, special to ProPublica)

As the Democratic primary campaign heats up, with the third debate scheduled for Sept. 12, candidates have used the slogan to distinguish themselves as bold progressives, moderate pragmatists or, in some instances, a little of both. The Trump administration has made it a point of attack, vowing to create a better system at lower costs. But interviews with voters and research by health policy experts show that the average voter has little idea of what is meant by the phrase that has already become a campaign signpost.

In its broadest terms, Medicare-for-all is what health care experts call single-payer: A system in which a government entity reimburses doctors and hospitals at a set rate. Many of the world’s most admired health care systems, from France to Israel to Canada, use some version of this approach.

Many health care experts argue that single-payer is the most effective way to deliver medical care to the greatest number of people. But until now, it has been politically unimaginable, taken off the table by most candidates seeking national office.

Health care “is the most important issue” of the election, and “single-payer is the right solution for American health care,” said Dr. Adam Gaffney, president of Physicians for a National Health Program and instructor at Harvard Medical School, who supports calling it Medicare-for-all but acknowledges pitfalls with the framing.

This “is an issue that affects, literally, every single person in this country,” he said. “Even putting the medical issues aside, it’s an economic issue. The way we finance health care promotes economic inequality.”

Medicare-for-all, in the purest sense, largely would replace private health insurance with a single, government-run program covering most everyone. It would be similar to traditional Medicare, the current federal health insurance program for most adults over 65 and young people meeting federal disability requirements, hence the name.

Sounds simple? It’s not.

Medicare was signed into law in 1965 after a 50-year effort to create a national health insurance system covering everyone. Opposition was so fierce that President Franklin Roosevelt excluded health insurance from the Social Security Act of 1935, and 13 years later President Harry S. Truman’s efforts to close what he called “the greatest gap in our social security structure” died in committee. The only way to get the law passed was by limiting coverage to older Americans.

And it’s worked, more or less, because of the government’s ability to set payments to health care providers. Still, high-quality, affordable coverage remains out of reach for many Americans, including many on Medicare. (Medicare covers only a portion of medical expenses, with many people buying supplemental plans to mitigate out-of-pocket costs.)

The Affordable Care Act, passed in 2010 during the Obama administration, was seen by many experts as a once-in-a-generation reform. Some argue it didn’t go far enough to provide every American with quality health insurance at a reasonable price. Others say it proves that the government isn’t the solution.

The fight over whether to expand the government’s health care system to cover all Americans has been part of the national conversation for generations, albeit often on the fringes, and was a topic of debate even before independent Sen. Bernie Sanders, of Vermont, made it his campaign rallying cry during his first Democratic primary presidential campaign in 2016.

Only Two Candidates Support Medicare-for-All in Its Broadest Terms

Source: ProPublica research (Credit: Moiz Syed and Akilah Johnson)

In fact, it was the lessons learned during President Bill Clinton’s failed health care reforms in the 1990s that inspired the term Medicare-for-all. The phrase first appeared in the Congressional Record in 2003 on a House bill introduced by former Rep. John Conyers Jr., of Michigan, and again in 2006 when the late Massachusetts Sen. Edward M. Kennedy, long a proponent of national health insurance, introduced the “Medicare for All Act.”

But it was a former staffer who suggested Kennedy start saying Medicare-for-all instead of single-payer.

“It was too wonky, and no one knew what it meant,” Dr. Philip Caper, a single-payer advocate for nearly 50 years who worked with Kennedy from 1971 to 1976, said during a phone interview from his home in Maine. “I said: What we’re really talking about is expanding Medicare for everybody. I think you should use Medicare-for-all from now on. It’s harder to demonize it … and you don’t have to explain it.”

The senator took his advice, but the bill died in committee.

“This is the first time the notion of Medicare-for-all has really had any political traction” since 1974, Caper said.

It was the subject of the first question asked during the first night of the second Democratic presidential debate in Detroit, where the discussion lasted more than 20 minutes. And a recent Morning Consult/Politico poll showed that 65% of voters say they would support a candidate in the Democratic primary who favors Medicare-for-all over preserving and improving current health care laws.

Still, Caper said, for such a shift to work, there would be a huge need to educate the public and grow a large, active constituency around Medicare-for-all. Elected officials “hate the political pain” that often accompanies large-scale change, he said.

Plenty of people are arguing against Medicare-for-all, urging program reforms but not restructuring. Dozens of health care business groups created the Partnership for America’s Health Care Future to eschew “one-size-fits-all health care … whether it’s called Medicare for all, buy-in, or a public option.” And though the American Medical Association is not listed as a member on the alliance’s website, its president said recently that it too believes in a “pluralistic system.”

“Rather than disrupt what we have now, let’s build up on the progress of it,” said Dr. Patrice Harris, president of the AMA. “Ninety percent of folks have health insurance. It really is about the 10% of folks who don’t.”

Making national health insurance a reality would mean redesigning the country’s health care payment infrastructure. It would involve going from a diffuse network that includes private insurers for those who can afford it and public services for a limited number of those who can’t into a single government-administered system. The role of insurance companies would be vastly reduced. By one estimate, as many 2 million people who are paid to process insurance claims or argue about them would lose their jobs.

Would people get to keep their doctors? Unclear. Would prescription drug costs decrease? Uncertain. Would wait times increase? Unknown. Copays? No, depending on the plan. Increase in taxes? Almost certainly, but again, it depends.

Jenkins’ workstation. (Gabriella Demczuk, special to ProPublica)

Because the current system doesn’t cover everyone, the government would have to raise money (that is, taxes) to pay for a national health care system. Economists and health experts agree that this would cost significantly more than the $3.5 trillion the nation currently spends on health care, about a third of which is spent on private insurance. And a substantial sum of the nation’s health care costs goes to administering and processing insurance claims.

They disagree on who would get taxed or how much and over whether the trade-off — higher taxes in exchange for limited to no copays, premiums or deductibles — would be worth it. Some experts argue that creating a national health care system would cost the country an additional $32 trillion. Others say it would eventually save $12.5 trillion. Determining who’s right, and by how much, depends on the design of the system which remains a heavily debated point of contention.

“When you say Medicare-for-all, there are eight different flavors,” with each dependent on each presidential candidate’s platform, said John McDonough, a professor at Harvard’s T.H. Chan School of Public Health who was instrumental in both Massachusetts’ universal health care plan and the Affordable Care Act. “It’s an advertising slogan; it’s not a scientific concept.”

A Kaiser Family Foundation report from July found that about three-fourths of the country supports expanding public health insurance programs, including allowing those 55 to 64 to buy into Medicare.

But the report showed that how politicians talk about the issue matters, with 63% responding favorably to the terms “Medicare-for-all” and “universal health coverage.” Those positive feelings begin dissipating when it’s called a “single-payer national health insurance system,” dropping to 49%. They essentially evaporate if it means eliminating private insurance, increasing taxes or disrupting the current Medicare system, with about 60% opposing a national health care plan.

“The problem is: What is Medicare-for-all?” asked Ashley Kirzinger, associate director for the Kaiser Family Foundation’s public opinion and survey research team, which has been polling on the topic since Sanders’ 2016 campaign pushed it into the mainstream. “It’s not Medicare and lots of times it’s not for all, so it’s a little bit of a misnomer.”

Core dimensions of health policy — cost, access, quality and equity — vary wildly depending on factors such as income, geography, race, gender, ethnicity and job type, McDonough said, adding that creating a formula to improve everyone’s health care is “very hard. When you make changes, you will improve it for many but diminish it for others.”

All 20 Democratic candidates say health care is a human right, and universal coverage has been a cornerstone of the Democratic Party’s platform. But universal coverage and Medicare-for-all can be achieved in very different ways — one can include keeping private insurance and the other, in the strictest sense, doesn’t — and are not necessarily synonymous.

Candidates’ health care platforms exist on a spectrum from least to most disruptive, with some calling for building on the current system while others champion its complete dismantling.

Twelve support Medicare-for-all — or something like it — with some, such as Beto O’Rourke, the former Texas congressman, and Mayor Pete Buttigieg of South Bend, Indiana, opposing a single-payer system while trading in the brand recognition that is Medicare-for-all with their respective slogans “Medicare for America” and “Medicare for all who want it.”

The candidates views are not fixed. Some have occupied several positions at once or adjusted their plans to be more mainstream.

Three of the six senators in the race co-sponsored the bill written by Sanders to establish a national Medicare-for-all health insurance program. And until recently he remained the consistent single-payer stalwart, committed to the bill as written. But he, too, reportedly announced compromises for union workers that would allow any employer savings under Medicare-for-all to be passed along to workers in money or other benefits. Others, however, have flirted with — or flat-out embraced — maintaining private insurance.

And Sen. Kamala Harris of California, who calls her plan Medicare-for-all though it includes a mix of public and private insurance, co-sponsored the Sanders bill. She also co-sponsored four other bills along the ideological spectrum currently before Congress.

Then there are candidates such as former Vice President Joe Biden and former Maryland Rep. John Delaney who say Medicare-for-all is too controversial and costly an experiment. Universal coverage can be reached without completely upending the system, they contend.

Nearly Every Senator Running Has Co-Sponsored Multiple Medicare Bills Across the Spectrum

See which pieces of legislation those Democrats have supported in the current Congress.

Source: Kaiser Family Foundation (Credit: Moiz Syed and Akilah Johnson)

Caper, the single-payer evangelist who helped popularize the term, said presidential candidates “water it down” and “confuse the issue” by suggesting Medicare-for-all can include commercial insurance.

To him it’s simple: The mission of commercial insurance is to make money while Medicare’s mission is to facilitate care for people. “That’s a fundamental difference,” he said.

Some voters remain unmoved, convinced that the health care debate is little more than meaningless campaign rhetoric.

“Politicians have no clue what it’s like out here,” said Margaret Coates, who, for more than two decades, worked in medical billing for providers and insurers.

Medicare is expensive and confusing, she said, and so is trying to buy health insurance. About two years before she turned 65, Coates said the government began inundating her with a dizzying array of information about Medicare.

“I did not know how expensive these plans were until I reached Medicare age,” she said, sitting in the magazine section of the Gaithersburg library, where signs posted against the back wall ask, “Are you eligible for help with Medicare costs?”

The need for help is widespread. Medicare covers about 80% of the costs of doctor visits and outpatient services; most seniors buy insurance to cover some or all of the remainder.

Coates’ 28-year-old daughter, a cosmetologist, has had her own health care struggles. Last year, she paid more in federal taxes for not having insurance, a penalty that costs at least about $700 per adult. (The Tax Cuts and Jobs Act of 2017 eliminated penalties for taxes filed in April 2020.) To avoid another penalty, she took on the cheapest insurance she could find at a cost of about $120 a month. With a $3,000 annual deductible, she has had to turn to her parents for help with medical bills.

“Everyone is up there cheering and happy because you have medical insurance,” Coates said. “But no one is saying what happens after you get it.”

Much of the conversation about the costs associated with Medicare-for-all include trillion-dollar figures, which does little to explain how it would affect taxpayers’ wallets. What resonates most with voters are not big aggregate numbers, but people’s out-of-pocket costs, said Kenneth Thorpe, an Emory University health policy researcher who worked as a legislative consultant to Vermont during its failed effort to create a single-payer system.

“We spent two years doing estimates, saying if we ran [health care] through the state, what would the state have to raise in taxes?” The answer, he said: Almost a 20% increase in payroll and income taxes. Creating a single-payer plan that would have covered everyone in Vermont would have forced some small businesses to close and put some people out of work.

In the end, he said the trade-off — increase taxes to expand coverage and decrease health care costs — wasn’t worth it, so “they dropped it, one of the most liberal states in the country.”

Charles Blahous, a senior research strategist at the Mercatus Center at George Mason University, and a former trustee of the Medicare and Social Security programs, said it would be an “analytical mistake to say we’re paying for this in other ways.” Because, he continued, “even if you make a very aggressive assumption for substantial administrative cost savings and substantial drug cost savings. It would still be the case that national spending would be higher.”

About 81% of Democrats and left-leaning independents say the federal government has a responsibility to ensure health insurance for all Americans, according to a recent Pew Research Center poll. The opposite is true of Republicans and right-leaning voters, 77% of whom say this is not the government’s responsibility.

Anger over the passage of the Affordable Care Act, which made health care more accessible and affordable for millions of Americans without coverage (though, critics say, not affordable and accessible enough), helped give rise to the Tea Party. Republicans made repealing President Barack Obama’s signature health care legislation central to their party’s effort until the 2018 midterm elections, when voters turned out en masse demanding that key provisions be retained.

Still, the Trump administration said replacing the ACA is key, backing a federal lawsuit seeking to overturn the law and proposing rules allowing individuals to purchase short-term insurance, small businesses to join forces to offer employees health plans, and employers more flexibility in how they fund health insurance.

Health and Human Services Secretary Alex Azar reiterated the administration’s objective of “choice and competition” during a July speech before an advocacy group whose mission is to improve private health insurance options for Medicare beneficiaries while taking aim at the Medicare-for-all debate. He criticized “a total government takeover” as a “reckless” idea.

Taking a seat at an empty barber chair at Graceful Touch, Antonio Dickerson shakes his head in disgust at the idea of government working to improve life for people like him.

“Absolutely not,” said the 50-year-old, rubbing a scar on his shin, a reminder of health care interactions that have left him with a heavy dose of skepticism that Medicare-for-all — or essentially any government action — will result in meaningful reform.

He watched Jenkins, his friend and co-worker, return to work instead of recuperating after surgery because he can’t afford the supplemental coverage that would allow him to take more time to heal.

Jenkins returned to work instead of recuperating after his injury because he can’t afford supplemental coverage. “Health care is ridiculous. These politicians really need to step their game up,” he said. (Gabriella Demczuk, special to ProPublica)

He watched his grandmother die two weeks after being released from the hospital, saying her insurer would no longer cover the cost of her care.

He watched one nurse’s shift end — and begin again — as he waited, uninsured, in an emergency room for hours, blood oozing from an open wound on his shin that eventually required 32 stitches.

“If you don’t have any money, get to the back to the line,” he said asking if those in the barbershop had ever seen “John Q,” a 2002 movie starring Denzel Washington about a husband and father whose son needs a life-saving operation but insurance won’t cover it.

Washington’s character takes the emergency room hostage, forcing the hospital and doctors to perform his son’s heart transplant.

That, said Dickerson, is “a very understandable situation.”

https://www.propublica.org/article/medicare-for-all-is-not-medicare-and-not-really-for-all-so-what-does-it-actually-mean 

The American Medical System Is One Giant Workaround

by Theresa Brown - NYT - September 5, 2019

The nurses were hiding drugs above a ceiling tile in the hospital — not because they were secreting away narcotics, but because the hospital pharmacy was slow, and they didn’t want patients to have to wait. I first heard about it from Karen Feinstein, the president and chief executive of the Jewish Healthcare Foundation, who reported it at a board meeting several years ago. I wasn’t surprised: Hiding common medications is a workaround, an example of circumventing onerous rules to make sure patients get even basic care.
Workarounds are legion in the American health care system, to the extent that ECRI (formerly the Emergency Care Research Institute) listed them fourth among its list of top 10 patient safety concerns for health care organizations in 2018. Workarounds, the group writes, are an adaptive response — or perhaps one should say maladaptive response — to “a real or perceived barrier or system flaw.”
Staff use workarounds because they save valuable time. According to Anita Tucker, a business professor at Boston University, system breakdowns, or what she calls “operational failures,” and the workarounds they stimulate, can “consume up to 10 percent of a nurse’s day.” Most hospital nurses are stretched to their limits during their 12-hour shifts. No nurse has 90 minutes to lose to a slow pharmacy or an inefficient hospital bureaucracy.
I saw the common sense that can underlie workarounds when my hospital floor instituted bar code scanning for medication administration. Using a hand-held scanner to register bar codes on medications and patients’ hospital bracelets sounds smart. But then some medications routinely came without bar codes, or had the wrong bar codes, and we nurses weren’t given an easy way to report those errors. Patients’ wrist bands could be difficult to scan and the process disturbed them, especially if they were asleep. The lists of medications on the computer screen were also surprisingly hard to read, which slowed everything down.

But the biggest problem was that the scanning software did not work with our electronic medical records — so all drugs had to be checked off in both systems. This is a huge problem when dealing with patients like those receiving bone-marrow transplants, who might get 20 drugs every morning — some of which are delivered through IVs and come with nonstandard doses. What was already a lengthy process suddenly took twice as long.
Some nurses responded to the arrival of the bar code system with workarounds, including refusing to use the scanner, or taping copies of patient bar codes to their med carts. I tried to adhere to the rules, but if I was especially busy or couldn’t get a medication to scan, I would chuck the whole process.
However, because bar code scanning has been shown to reduce errors in medication administration, the hospital officials wanted it to be done consistently. They produced a public list of all the nurses on the floor. Each nurse was labeled green, yellow or red, depending on the percentage of medications he or she administered using bar codes. Family members, doctors — anyone could see how a nurse was graded.
Over time the list worked, but the sting of it also endured. We were being punished for taking time for patients, even if it meant bending the rules. No one among the managerial class seemed to understand that nurses care a lot about patient safety. The unheard concern was that a green light for bar code scanning meant a patient could fall into the red zone for something else.
Workarounds in health care always involve trade-offs like this, and often they are trade-offs of values. Increasingly, the entire health care system is built on workarounds — many of which we don’t always recognize as such.

Consider the use of medical scribes, who complete doctors’ electronic paperwork in real time during patient visits. The American College of Medical Scribe Specialists reported that 20,000 scribes were working in 2014, and expects that number to climb to 100,000 in 2020.
I have heard doctors say they need a scribe to keep up with electronic medical records, the mounting demand of which is driving a burnout epidemic among physicians. Scribes allow doctors to talk with and examine patients without having a computer come between them, but at base they are a workaround for the well-known design flaws of electronic medical records.
As a nurse, when I first learned about scribes, I was outraged. On the job, nurses hear repeatedly how health care companies can’t afford to have more nurses or aides to work with patients on hospital floors — and yet, money is available to pay people to manage medical records. Doctors who use scribes tend to see their productivity and work satisfaction increase, but the trade-off is still there: Scribes demonstrate the extent to which paperwork has become more important than patients in American health care.
The Affordable Care Act, which I support because it has made health care available to millions of previously uninsured Americans, is also an enormous workaround. The act expanded Medicaid, protected patients with pre-existing conditions and offered subsidies to make private insurance more affordable. Obamacare, though, was never intended to make sure that all Americans had affordable care; it works around our failure to provide health care to all our citizens. In its own way, the Affordable Care Act is as jury-rigged as using ceiling tiles to stash medications.
The United States spends more per person on health care than any other industrialized country, yet our health outcomes, including overall life expectancy, are worse. And interventions like bar code scanning are a drop in the bucket when it comes to preventable medical mistakes, which are now the third-leading cause of death in the country. Our health care nonsystem is literally killing us.
As the workarounds accumulate, they reveal how fully dysfunctional American health care is. Scribes are workarounds for electronic medical records, and bar code scanning is a workaround for our failure to put patient safety anywhere near the top of the health care priority list. It’s a values trade-off that the nurses on my floor instinctively understood.
Theresa Brown is a clinical faculty member at the University of Pittsburgh School of Nursing and the author of “The Shift: One Nurse, Twelve Hours, Four Patients’ Lives.”
https://www.nytimes.com/2019/09/05/opinion/hospital-workaround-health-care.html?action=click&module=Opinion&pgtype=Homepage

Maryland's Health Care Price Controls Aren't Solving Problems—They're Creating Them

Hospitals gamed the system and costs didn’t come down.

 by Peter Suderman - Reason - June 26, 2019

The 2020 Democratic field, as with much of the Democratic party, is currently fighting about whether to expand Obamacare, allow more people into Medicare, or pursue the more radical option of full-fledged single-payer. But should a Democrat win the White House next year, it's likely that left-leaning wonks will make a push for a somewhat different, lesser-known idea: "all-payer rate setting"—or, as it is more colloquially known, price controls. 
The basic idea behind all-payer is that the government sets prices for hospital services in a given region, offering transparency and eliminating the sort of maddening price differentials that frustrate patients, outrage politicians, and make headlines when they are revealed. 
In theory, all-payer should hold down health care costs by making it impossible to mysteriously jack up prices for health care services. In practice, however, all-payer ends up captured by the hospitals it is supposed to constrain, adds new layers of confusion to the already complex process of health care pricing, and, although it helps control spending on certain particular metrics, doesn't serve as a meaningful overall check on health care costs. 
Those are the main takeaways from Manhattan Institute scholar Chris Pope's new study of rate regulation in Maryland, which has maintained an all-payer system for about four decades. State-based price setting was common in the 1970s and 1980s, but largely disappeared by the 1990s; Maryland is the only state which continued the policy. And it continues, Pope concludes, because the state's hospitals like it, since it effectively guarantees them a large additional income stream from the federal government.
Maryland's all-payer system historically operated under a unique waiver from the federal government that ends up granting the state's hospitals about $2.3 billion a year more than they would get otherwise. The reason this extra pot of money exists is that in Maryland, Medicare rates are much higher than in other states. Typically, the rates Medicare pays hospitals are far lower than the rates paid by private insurers; nationally, private rates are about 67 percent higher than Medicare, a differential that has increased considerably in recent years. In 1997, they were just 13 percent higher.
But that's not the case in Maryland, because the state's all-payer system means that every price is the same, regardless of whether the payer is public or private. This results in somewhat lower private payments—about 13 percent lower than the national average, according to Pope. But it also means that Medicare rates are much higher than is typical—on the order of 40 percent higher for inpatient services and 60 percent for outpatient. 
When all rates are the same, in other words, the rates paid by the federal government go way up, resulting in much higher than usual total payments. Maryland's rate-setting system is designed to extract a windfall from the federal government.
And just because the rates are regulated doesn't mean hospitals don't find other ways to exploit the reimbursement system. For much of the system's life, the state's hospitals posted lower than average growth per admission but had significantly higher than average volume, which allowed them to extract additional money since total reimbursements weren't capped.
That changed somewhat over the last decade with the adoption of so-called "global budgets," a complex system designed to contain total payments to a hospital and prevent volume-based gaming. Early reviews of the state's global budgeting system found that savings didn't always materialize. There are other concerns, too: By capping spending, global budgets have the potential to punish hospitals that attract more patients by offering higher-quality care. 
And even in a capped system, there are other ways around the state's rate regulations: As Pope notes, the state is home to more ambulatory surgery centers—which are not bound by all-payer prices—than any other state. There is some reason to suspect that privately insured patients who might pay higher rates are being pushed into those venues. 
In addition, the rules themselves become a kind of labyrinth of formulas and adjustment mechanisms. As Pope writes, "decades of reform have seen layers of regulations piled up to deal with the unintended consequences of previous regulation—in turn, generating still additional challenges that must be addressed with still further regulation." Adjustments to the rates are governed by obscure formulas that few really understand. 
All of this tracks with previous studies of rate-setting programs. A 1997 Health Affairs piece on the history of state-based rate setting found that "the statutes and regulations needed to sustain their rate-setting systems were complex and often incomprehensible." Even in their heyday, it was clear that rate-setting systems had limited usefulness. In 1985, a study in the Journal of Health Politics, Policy, and Law, for example, found that states implementing rate setting saw lower per-admission costs but found "no direct evidence that total health care costs" were contained. Although these systems perform well on some targeted metrics, the hoped-for savings have always been something of a mirage. 
In part that's because confusion about these systems tends to benefit large incumbents who are better equipped to manage their quirks than lower-cost upstarts. So it is no surprise that Pope describes Maryland's rate-setting process as being "dominated by hospitals," and offers some historical evidence to suggest that the original rules were crafted in part by the state's hospitals themselves. 
This is how health care payment schemes almost always are: inscrutable, convoluted, yet somehow designed almost perfectly to funnel as much money as possible to health care providers. As Charles Silver and David Hyman argued in their recent book, Overcharged: Why Americans Pay Too Much for Health Care, much of the U.S. health care system only makes sense if you imagine it as a tool for funneling as much money as possible to health care providers. 
The limitations of Maryland's program offer a lesson not only for would-be technocrats touting the virtues of price controls on their own but also for those backing single-payer, which, in transferring control of virtually all of the nation's health care financing to the government, would require federal bureaucrats to set rates and budgets. There would be formulas and systems. They would necessarily be complex, because the delivery of health care is inherently complex. And eventually, if not immediately, they would probably be captured by the organizations—especially hospitals—that stand to benefit. 
https://reason.com/2019/06/26/marylands-health-care-price-controls-medicare-for-all-single-payer/ 

The Hospital Treated These Patients. Then It Sued Them.

by Laura Bell - NYT - September 3, 2019

CARLSBAD, N.M. — The first time Carlsbad Medical Center sued Misti Price, she was newly divorced and working two jobs to support her three young children.
The hospital demanded payment in 2012 for what Ms. Price recalled as an emergency room visit for one of her children who has asthma. She could not afford a lawyer, and she did not have the money to pay the bill.
Ms. Price let the summons go unanswered, figuring she would settle the balance — with interest, about $3,600 — when she could. A few months later, she opened her paycheck and discovered the hospital had garnished her wages by $870 a month.
Her car was soon repossessed because she could no longer make the payments. She was on the verge of losing her house, too, when her mortgage company stepped in to help her save it.

“I was going to let it go,” Ms. Price said, tearing up recently in an interview at the Carlsbad Public Library. “It was tough.”
And it was only the beginning. Ms. Price, 40, a nurse and local 4-H leader, has been sued five times by Carlsbad Medical Center, for bills totaling more than $17,000.
It’s not because she and her children are uninsured; according to the hospital, the charges are what she owed after her insurer had paid. But Ms. Price said she had never received an itemized bill outlining exactly what she owed money for. The collection agency wanted the balance in full, and she was not able to work out a payment plan until after she was sued.
In this town, she has a lot of company.
An examination of court records by The New York Times found almost 3,000 lawsuits filed by Carlsbad Medical Center against patients over medical debt since 2015, more than 500 of them through August of this year alone. Few hospitals sue so many patients so often.
Ms. Price’s sister, a police dispatcher, has been sued twice. Her husband has been sued. The county judge who hears many of these cases was once sued, too.

Carlsbad Medical Center is not the only hospital to have filed reams of lawsuits over unpaid bills. In Memphis, Methodist Le Bonheur Healthcare, a nonprofit hospital, filed 8,300 lawsuits from 2014 through 2018, including some against its own employees, according to an investigation by the journalism nonprofit groups ProPublica and MLK50.
In Virginia, hospitals filed more than 20,000 lawsuits over patient debt in 2017 alone, according to a study by researchers at Johns Hopkins University. Just five hospitals accounted for half of the resulting wage garnishments in the state.
People across the country are coping with soaring medical costs, opaque pricing and surprise bills, but these issues are felt acutely in one-hospital towns like Carlsbad, where residents have few options for care — and must pay whatever prices the hospital sets.
“Hospitals that have little competition can negotiate higher rates, because the insurer wants that hospital in their network,” said Sara Collins of the nonprofit Commonwealth Fund. Patient deductibles, which must be paid out of pocket, are rising for almost everyone, she added.
Nationally, more than one in four consumers in 2018 were reported to credit bureaus over unpaid debt, according to the Consumer Credit Protection Bureau. More than half of those reports involved medical bills. One survey of women with breast cancer found that a third of those with health insurance had been referred to bill collectors; among those without insurance, the number rose to 77 percent.

People confronted with medical debt typically drain their savings, the Commonwealth Fund has found, and 43 percent said it lowered their credit rating, suggesting that many of these consumers were reported to collections agencies.

Melissa Suggs, a spokeswoman for Carlsbad Medical Center, declined requests for interviews about the hospital’s debt collection practices.
“The majority of accounts from which we seek to collect payment are patients with insurance who have not fulfilled their deductible, co-payment, or coinsurance responsibility set by their health insurance plan — and who have chosen not to enter into a payment arrangement for those amounts,” the hospital said in a written statement.
Following inquiries from The New York Times, the hospital said on Friday that it would no longer sue patients whose incomes are below 150 percent of the federal poverty level (roughly $19,000 for a single person), whether they have insurance or not, and would release current court judgments against any such patients.
Uninsured patients will now receive “discounts” that will bring down their bills roughly to Medicaid reimbursement rates, the hospital said.
New Mexico expanded Medicaid enrollment under the Affordable Care Act in 2014, and most of these patients qualify for coverage. The state is now considering a Medicaid “buy-in” option that would further expand coverage.

Liens and garnished wages

A small, sun-baked town once known mostly for its nearby caverns, Carlsbad’s population has ballooned in recent years with an influx of workers drilling and fracking in the oil-rich Permian Basin.
The town’s sole hospital, Carlsbad Medical Center has long faced criticism from community leaders for high prices.

In 2013, officials of Carlsbad, which is self-insured, formed a task force called the Mayor’s Hospital Reform Committee to address the strain on its budget over health care costs for city employees. Administrators considered sending employees to neighboring towns for care before they were able to negotiate lower rates for key services.
In a presentation to the state legislature in 2015, the mining company Intrepid Potash, a major employer in Carlsbad, calculated that it would be cheaper for one of its workers to travel to Hawaii for a gall bladder operation — including airfare for two, and a seven-day island cruise — than to get the procedure at the local hospital. The company still encourages employees to seek care out of town when possible.
In May, a nationwide survey by the RAND Corporation found that private insurers paid Carlsbad Medical Center five times more than Medicare would have paid for the same services — about twice the figure in the state overall.
Carlsbad Medical Center is owned by Community Health Systems, a chain of hospitals based in Franklin, Tenn. An investigation in 2014 by the Santa Fe New Mexican newspaper found that the three hospitals charging the highest prices in the state were all owned by that chain.
In 2015, the company paid $98 million to the federal government to settle charges that it had inflated revenue by admitting patients unnecessarily. Community Health Systems admitted no wrongdoing.
In 2018, a unit of the company agreed to pay $260 million to settle charges, brought by the Department of Justice, that it had systematically overbilled for emergency room visits. Company officials noted that the fraud occurred before C.H.S. bought the subsidiary.
There are alternative hospitals near Carlsbad, but the closest is more than 40 minutes away, in the town of Artesia — which residents may find too far to drive to in an emergency. One of Ms. Price’s bills followed an emergency room visit after her daughter broke her arm on the soccer field.

“When your kid’s in pain, it’s hard to wait 45 minutes to get them there,” she said.

Victoria Pina, 38, an instructional aide who lives in nearby Loving, N.M., visited the Carlsbad Medical Center emergency room several times for a shoulder that repeatedly dislocated.
“For me to be driving over 45 minutes to an hour to Artesia, I can’t make it,” she said.
She’s been sued three times by Carlsbad Medical Center over E.R. bills. After the first suit, she tried to call a number listed on the paperwork to work out payments, but said she never got a return call.
The hospital attempted to garnish her wages, and then placed liens on her home totaling more than $9,000. She and her husband discovered the liens recently when they attempted to refinance their mortgage to a lower interest rate.
Had they been able to lower their house payment, they could have put aside the money to pay the hospital bill, she said. “But because of the lien on the property, we can’t bring our house payment down,” she added. “And that’s hard.”
If Ms. Pina had gone to another hospital nearby, she likely would have escaped a lawsuit. Lovelace Regional Hospital in Roswell, just over an hour away, has filed about two dozen suits over patient debts since 2015.
Artesia General has no debt-collection suits against patients on record since 2015. Neither does Presbyterian Hospital in Albuquerque — which, at 450 licensed beds, is almost four times as large as the hospital in Carlsbad.

By contrast, other hospitals owned by Community Health Systems in New Mexico also regularly file suits over unpaid bills. Lea Regional Medical Center in Hobbs has filed almost 2,000 such suits since 2015. Mountain View Regional Medical Center in Las Cruces has filed about 2,000 suits against patients in that time; almost half of them came just this year.
In Carlsbad, these lawsuits flood the docket. District Judge Lisa Riley, who has been on the bench in Eddy County since 2011, estimated that about one-third of all civil cases that come across her desk involve unpaid medical debt.
The overwhelming majority of lawsuits simply go into default judgment, she said, meaning that the defendants fail to respond — as was the situation in Ms. Price’s first case — and the hospital proceeds to garnish wages.
“Out of those people who do respond, which is very few, the responses almost always say, ‘I admit I owe the money and I’d like to make payment arrangements,’ or ‘I can’t afford to pay it right now,’” Judge Riley said. Hearings on the hospital cases are rare.
Hospital suits over unpaid debt are so frequent in Eddy County, “I had no idea that it wasn’t common practice,” Judge Riley added. “I assumed that all hospitals did that.”
She, too, was a target of the hospital before she became a judge. Her husband had been disputing emergency room charges when the hospital sued; the case was resolved and dismissed. (Judge Riley would not comment further, citing ethics restrictions that prohibit judges from making statements about matters that might appear in court.)

Judge Riley’s case and others from Carlsbad appear in an upcoming book called “The Price We Pay,” by Dr. Marty Makary, a surgeon at Johns Hopkins University who studies the costs of American health care and led the study of hospital suits in Virginia.

Debt collection is common in the health care industry, he said, but lawsuits are a traumatic way to force patients to pay. Normally hospitals simply refer unpaid bills to debt collectors; fewer file lawsuits and then garnish wages or place liens on homes.
In his study of Virginia, 36 percent of hospitals garnished the wages of patients owing money, with 10 percent doing so frequently. (Even his own institution, however, has come under fire for suing the poor.)
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When seeking payment for medical bills, “Collections agencies may harass you with phone calls,” Dr. Makary said. “They may send a note to your credit bureau, but they’re not reaching into your paycheck.”
Many of these patients are low-paid workers with little savings. Dr. Makary’s study found that Walmart was the most common employer of those whose wages were garnished over medical bills. “These are hardworking Americans who did nothing wrong,” he said.
The cost of care differs from institution to institution, partly because hospitals have broad discretion in setting prices. Charges for the same services vary widely, even when hospitals have similar patient demographics, and the amounts billed have little relationship to quality.
If you are a hospital executive, “you could charge whatever you want,” said Dr. Makary. “You could charge $1 million for an X-ray.”

Surprise bills

What frustrates patients is the inability to find out prices until the bill comes, even when they ask. “They say, ‘Oh, we can’t tell you until insurance pays,” said Melissa Phillips, Ms. Price’s sister. “That’s the answer. Or, ‘Depends what all we have to do.’”
Ms. Phillips, a police dispatcher who also has insurance, has been sued twice over hospital bills. Her husband was sued once.
Carlsbad Medical Center does have a chargemaster of sticker prices posted on its website. The charges are listed according to “service code” — some clear, others less so.
“Blood transfusion” is listed at $1,303.58. A more cryptic “CC-RHC” is listed at $53,711.62. But those prices differ from what patients actually will be asked to pay. In a statement, the hospital claimed that no patient actually pays the listed price.
In July, the Trump administration announced a proposed rule to require hospitals to make public the prices negotiated with insurers.

The disclosure is an important first step, but will not necessarily keep patients from amassing unanticipated debt, said Jack Hoadley, research professor emeritus at the Georgetown University Health Policy Institute.

Patients are still responsible for co-pays and deductibles, and the negotiated fee wouldn’t reflect extra payments for complications. “It still doesn’t fully tell you what your out-of-pocket liability is going to be,” he said.
Ms. Price’s insurance statements indicate that many of her bills have come from high deductibles and some from out-of-network charges — even though Carlsbad Medical Center is in network on her insurance.
Patients sometimes go to in-network hospitals for emergency care, but don’t learn until they get the bill that some providers or services — especially those in the emergency room — were actually out of network. Across the country, these “surprise bills” have become such a problem that many state legislatures have outlawed them.
New Mexico has such a law, but it does not go into effect until next year, said John G. Franchini, the New Mexico insurance commissioner.
“Small hospitals cannot afford an emergency-room medical doctor,” he said. “They can’t afford the full-time cost. This has become an abuse because people also can’t afford to pay it.”
John Heaton, a retired pharmacist and former New Mexico state legislator who lives in Carlsbad, worries that the hospital’s charges and aggressive billing are driving patients into nearby towns whenever possible.
“When somebody goes out of town, that revenue is lost,” he said. “And because it’s lost, the hospital has to charge everybody else more.”

Ms. Price remarried in 2017, and her husband has health insurance through his job at an oil field supply company. His wages were garnished last year by the hospital, the result of a lawsuit he does not remember ever seeing.
She no longer takes any chances. When she recently needed a mammogram, she said, “I drove to Artesia.”
https://www.nytimes.com/2019/09/03/health/carlsbad-hospital-lawsuits-medical-debt.html

John Heaton, a retired pharmacist and former New Mexico state legislator, worries the hospital’s charges and debt collection are driving patients to other facilities.CreditCassidy Araiza for The New York Times

Many Hospitals Charge Double or Even Triple What Medicare Would Pay

by Reed Abelson - NYT - May 9, 2019

In Indiana, a local hospital system, Parkview Health, charged private insurance companies about four times what the federal Medicare program paid for the same care, according to a study of hospital prices in 25 states released on Thursday by the nonprofit RAND Corp.
Colorado employers were shocked to learn they were paying nearly eight times what the federal government did for outpatient services like an emergency room visit, an X-ray or a checkup with a specialist at Colorado Plains Medical Center, northeast of Denver.
Across the nation, hospitals treating patients with private health insurance were paid overall 2.4 times the Medicare rates in 2017, according to the RAND analysis. The difference was largest for outpatient care, where private prices were almost triple what Medicare would have paid.
“It’s eye-opening, really, not just for the employers,” said Gloria Sachdev, the chief executive of the Employers’ Forum of Indiana, a coalition that helped with the study. “It’s eye-opening for the hospitals.”

The RAND study underscores the widening chasm between what the federal government and the private sector pay the nation’s hospitals.
The disparity shows how competition has faltered in an opaque market where the costs of care are secret and hospital systems are increasingly consolidated, gaining outsize clout in price negotiations with employers, some experts say.
This yawning spread in hospital rates will likely fuel the debate over Medicare-for-all proposals that would give the federal government authority to decide what to pay hospitals and that have proved popular with many Democratic voters on the presidential campaign trail. The plans, especially one championed by Senator Bernie Sanders, the Vermont independent, would provide universal coverage by replacing employer-based insurance with a government-run program.
Some proponents of Medicare for all argue that employers and private insurers have failed to control costs. About one-third of all health care spending in the country goes to pay for hospital care. Many supporters point to the billions of dollars that could be saved annually if hospitals and doctors were paid at the much lower Medicare rates.
“The shadow of single payer hangs all over this,” said Katherine Hempstead, a senior policy adviser at the Robert Wood Johnson Foundation, which helped fund the RAND research.

Because rates are normally a closely held secret between insurers and hospitals, the RAND study reveals a startling first glimpse of how much — and how steep a price — a broad swath of hospitals are charging private insurers. The lack of transparency, coupled with public outrage over rising hospital bills, has spurred calls for disclosure of the rates negotiated. This is the first time pricing information on a large group of individual hospitals has been made public.

Nationwide, employers provide coverage for most Americans under age 65, about 181 million people. And hospital care accounts for 44 cents of every personal health care dollar spent on those with private insurance.
The RAND study shows “market forces are clearly not working,” said Richard Scheffler, a health economist at the University of California, Berkeley. “Prices vary widely and are two and a half times higher than Medicare payment rates without any apparent reason,” he said.
The RAND researchers gathered information on 1,598 hospitals, about a third of the total number in the United States, using 4 million insurance claims from 2015 through 2017, a fraction of the total filed nationwide. The information was collected from employers, some insurers and state agencies. The study did not identify the employers, but researchers named individual hospitals through the information they obtained, a rare public listing.
The claims included a variety of services, ranging from a hospital stay for heart surgery to an outpatient visit to the emergency room. The researchers compared the claim as it would have been reimbursed by Medicare and what the private insurer paid to determine the overall difference in prices. The hospitals did not see the study before it was released.
The Indiana system, Parkview, says it is adopting new kinds of contracts. “At Parkview Health, we think the most important conversation is around what we can do moving forward, in strategic alignment with employers and insurance companies, to provide the highest quality care at the best cost,” said the company’s chief executive, Mike Packnett, in a statement.

Colorado Plains Medical Center did not respond to requests for comment.
In New York and Pennsylvania, private prices were less than two times the Medicare rates. Indiana, which has the highest private prices among the 25 states analyzed, pays roughly three times what Medicare does.
Many businesses that contract with insurance companies have no idea what their insurers are paying individual hospitals in their plan’s network. “We’ve never seen what was agreed upon,” said Jennifer Fairman, the benefits manager for people who work for Larimer County in Colorado. “We’ve been signing these blank checks.”
But soaring hospital costs have become a significant burden, and many businesses have off-loaded more of the expense onto their employees through higher premiums and deductibles. Families have struggled to cope with surprise medical bills and increasing out-of-pocket costs. The trend toward consolidation in the last several years has also spurred higher costs, as hospitals merged into bigger, more powerful systems that dominated their local markets, demanding ever-higher prices.
Unlike Medicare, which sets the price it will pay for a type of care, insurers often try to negotiate discounts with hospitals over charges, especially for outpatient services, said Chapin White, an adjunct senior policy researcher at RAND and one of the authors of the study.
The insurers don’t have a strong incentive to demand the lowest prices because many, working for employers that are self-insured, are “literally spending someone else’s money,” he said. Insurers are also frequently paid based on how much the employer spends; they take in more revenue when the employer spends more.
Insurers say they are motivated to keep hospital prices low and point to the battles they sometimes have over whether a high-priced system will be in their networks.

One outlier was Michigan, where private prices run about 1.5 times Medicare rates. The auto industry and unions that represent autoworkers have put pressure on the major Blue Cross plan to hold hospital prices down. “To keep the market in check, you need a plan to throw its weight around and employers to back them up,” Mr. White said.

Hospital prices are not always linked to overall costs, however. In Michigan, for example, insurance premiums are relatively high, even though hospital prices are low.
In contrast to private insurers, “Medicare has been much more zealous about keeping its payments down,” said Sherry Glied, dean of the Robert F. Wagner Graduate School of Public Service at New York University.
Hospitals argue that they lose money under Medicare, and many say they are aggressively trying to lower costs. Paying the hospitals at Medicare rates would have a significant impact on the industry, causing many hospitals to close, according to some experts.
“Medicare payment rates, which reimburse below the cost of care, should not be held as a standard benchmark for hospital prices,” said Melinda Hatton, general counsel for the American Hospital Association, an industry trade group, in an emailed statement. “Simply shifting to prices based on artificially low Medicare payment rates would strip vital resources from already strapped communities, seriously impeding access to care.”
Policy experts say the hospitals have come to rely on higher payments from employers and insurers. “The whole system is symbiotic,” Ms. Glied said. If private insurers paid the hospitals less, they “would look different and have a different cost structure.”
But some critics say hospitals are clearly flush and that private insurers are paying too much.
“It explains some of the market behaviors we’ve seen,” said Robert J. Smith, executive director of the Colorado Business Group on Health, which represents employers. Although the hospitals in his state are only two-thirds full, they are building new facilities and buying physician practices.

The purpose of the research, Ms. Hempstead said, was to arm employers with information about prices. While previous efforts focused on giving consumers information so they could be smarter shoppers, employers are the ones that can benefit, she said. “The real consumers are the employers,” she said.
Employers can use Medicare as a starting point for how much they should be paying the hospitals, for example, or combine information about the quality of individual hospitals with the prices they charge to steer workers to those facilities that offer the best value. “What was missing was price,” said Ms. Sachdev of the Indiana employers group.
In Indiana, where a pilot study on hospital prices led to the Rand research, the realization that insurers were paying so much has already altered how insurers are contracting with hospitals. Anthem, the for-profit insurer headquartered there that operates the state’s Blue Cross plan, now uses Medicare as a basis for how much it will agree to pay the hospitals.
Anthem says it is now developing new networks made up of significantly fewer hospitals and will steer people to places that deliver the best quality at lower prices, said Paul Marchetti, a senior vice president at Anthem. “That’s where we are headed as a company,” he said.
But employers are still paying much higher prices than the government. “We should not be allowing this,” said Mr. Smith, with the Colorado employer group. It plans to combine pricing information with quality data so businesses can better judge the value of care at individual hospitals.
It will be up to the employers to prove that they can exert discipline on controlling health care costs, which he called an open question: “Can the U.S. market become more effective or more efficient or do we need a single payer?”
https://www.nytimes.com/2019/05/09/health/hospitals-prices-medicare.html

Workers are celebrated during annual Labor Day breakfast in Portland

by Gillian Graham - Portland Press Herald - September 2, 2019

Union workers and supporters gathered in Portland on Labor Day to celebrate the labor movement and highlight calls for universal health care for Americans.
During the annual Southern Maine Labor Council Labor’s Day Breakfast at the Irish Heritage Center, more than 250 stood to cheer Monday as Philippa Adam, who works in the food program at Preble Street, described how she and her co-workers voted 90-10 to form the Preble Street Workers United Union.
The newly formed union, represented by the Maine State Employees Association-Service Workers International Union Local 1989, is now in bargaining discussions with Preble Street, which serves homeless and low-income Mainers at the organization’s soup kitchens, food pantry and shelters in Portland, Lewiston and Bangor. Adam said early discussions have focused on worker safety.
“We built this union with our bare hands and we are so proud. We finally have a seat at the table and it will not stop there. It has been a banner year for workers’ rights at Preble Street,” Adam said to thunderous applause.
That type of enthusiastic solidarity is typical of the annual event, attended by workers, supporters, local elected officials and labor organizers, and continued when keynote speaker Jose La Luz took the stage.
La Luz, a veteran organizer who led the campaign to achieve collective bargaining rights for public workers in Puerto Rico, gave a rousing speech about universal health care. Since 2017, La Luz has been campaigning for Medicare for All. He called on workers to come together to fight against “coordinated, sustained and escalating assaults” on organized labor and push for universal health care for everyone in the “wealthiest nation in the world.”
“The wonderful thing about this movement is every time we come together we recommit ourselves to this thing you and I call solidarity,” he said. “It’s about the fact that each one of us has to stand up for all the others. If there is an injury to one of us, there is an injury to all.”
Presidential hopeful and U.S. Sen. Bernie Sanders of Vermont was originally scheduled to speak at the breakfast. But organizers later asked him to attend but not speak because a speech by him could have been perceived as an implied endorsement of his candidacy by the Southern Maine Labor Council, said Douglas Born, the group’s president. Sanders’ campaign announced overnight that he would not be appearing at the event.
The last-minute cancellation did not put a damper on the event, which Born said was the council’s best ever.
Laura Fortman, commissioner of the Maine Department of Labor, spoke briefly at the breakfast, discussing the department’s commitment to enforcing labor laws and the need to give support and stability to people who are working longer and harder at multiple temporary jobs.
“The way to change that is through unionizing,” she said.
The Working Class Hero Award was presented to attorney Howard Reben, who for years has represented unions and workers in workers’ compensation and discrimination cases.
After the breakfast, union members marched to Longfellow Square, where Harlan Baker read from “I Hear America Singing” by Walt Whitman while standing at the base of the Henry Wadsworth Longfellow statue.
https://www.pressherald.com/2019/09/02/workers-celebrated-during-annual-labor-day-breakfast-in-portland/