'Threadbare' US System Denounced as Study Shows 12 Million Lost Employer-Tied Healthcare During Pandemic
"Delinking health insurance with jobs should be a top policy priority."
Nurse practitioner Daniel Lucas-Neel II checks the temperature of a man who asked to be screened at a pop-up Coronavirus testing site run by a free clinic in Charleston, West Virginia on April 13, 2020. The free clinic called West Virginia Health Right has seen an increase in people seeking help because they lost their healthcare coverage when they lost their jobs. (Photo: Michael S. Williamson/The Washington Post via Getty Images)
Medicare for All advocates had new reason to decry the U.S. system that ties the healthcare for many to employment after a new study released Wednesday showed an estimate 12 million Americans have lost their employer-sponsored insurance coverage since the Covid-19 pandemic hit earlier this year.
"At a minimum, policymakers concerned about
Americans’ health security should have the federal government pay for
all testing and treatment for COVID-19 related expenses in coming
months."
—Economic Policy Institute
"Because most U.S. workers rely on their employer or a family member’s employer for health insurance, the shock of the coronavirus has cost millions of Americans their jobs and their access to healthcare in the midst of a public health catastrophe," Josh Bivens, co-author of the study and director of research at the Economic Policy Institute (EPI), said in a statement announcing the findings.
"Tying health insurance to the labor market is always terribly inefficient and problematic, but becomes particularly so during times of great labor market churn," said Bivens.
"Delinking health insurance with jobs should be a top policy priority," EPI tweeted in a thread about the study and the authors' takeaways. "The most ambitious and transformational way to sever this link is to make the federal government the payer of first resort for all health care expenses—a 'single payer' plan like #MedicareForAll."
But despite growing popularity of such a system among the American public, neither the Republican nor Democratic party platforms embrace the idea, despite continued advocacy from more progressive members of Congress and activists.
Rep. Ilhan Omar, (D-Minn.) and Sen. Bernie Sanders (I-Vt.) introduced legislation this month to cover out-of-pocket healthcare expenses of all Americans during the pandemic by authorizing a wealth tax. Entitled the "Make Billionaires Pay Act," the measure would be funded by taxing the wealth gains accrued by billionaires since March as millions of Americans lost their jobs. Both Sanders and Omar have co-sponsored Medicare for All legislation in the past, and the EPI study's authors urged lawmakers to act quickly.
"The coronavirus pandemic has exposed how incomplete and threadbare the U.S. safety net and social insurance system is," said Ben Zipperer, an economist and study co-author. "In order to help millions of Americans during the pandemic and beyond, policymakers must take swift action to address the inequities and inefficiencies in our health care system."
EPI also noted online Wednesday that a single-payer system would not be a job killer, as its opponents like to assert.
"Medicare for All is a hugely ambitious policy, and there's a lot to debate about it. But the idea it would have a massive job-killing effect is a fake story," Bivens said in an explainer video EPI shared on Twitter Wednesday.
"At a minimum, policymakers concerned about Americans' health security should have the federal government pay for all testing and treatment for Covid-19 related expenses in coming months," Bivens and Zipperer wrote.
The pandemic shows America can't afford its dysfunctional health insurance system
Labor ‘We Are Being Left Behind': Retired Hollywood Actors Protest Changes to SAG-AFTRA Health Plan
by Jeremy Fuster - The Wrap - August 25, 2020
David Lander had been a member of SAG-AFTRA long before he got his big break as Squiggy on the classic 1970s sitcom “Laverne & Shirley.” But now, he and thousands of retired members of Hollywood’s actors guild are about to be thrown off of their health plan due to drastic changes being made to cut costs in the wake of the COVID-19 pandemic. And that’s especially bad for Lander considering that he has spent the past 36 years grappling with multiple sclerosis. “People need to know how serious this is,” he told TheWrap. The health plan “has kept me alive, and I never thought it would disappear.”
Most asked to remain anonymous to protect sensitive health information. But the retirees interviewed have been diagnosed with a wide range of serious medical conditions, from cancer to debilitating illnesses and disorders, all of which require treatments that cost thousands of dollars even with Medicare.
“I had a solid plan with SAG-AFTRA. My doctors called it a Cadillac plan,” one member, who has been with the guild for 27 years, told TheWrap. “Now, I feel completely desolate without it. I have to enter this Medicare process, and it is going to cost me thousands to get what my husband needs.”
As a result of pandemic-fueled financial troubles, SAG-AFTRA on August 12 announced significant raises to premiums and minimum earnings requirements that it says are necessary to keep the entire plan afloat. Quarterly premiums will jump to $375 — or $747 for those with two or more dependents. Members under 65 will also now have to earn $25,950 or work at least 100 days during a 12-month base earnings period to qualify for coverage.
But the biggest change for seniors is that they will no longer be able to count residuals — which many Hollywood retirees rely on as a fixed income — towards that minimum earnings count.
“It’s infuriating. I’ve been in meetings telling us that this will knock 10% of health plan members off of coverage,” said one member who has been on a guild health plan since 1985. “Well, that 10% is going to be scrambling to get health care in the middle of a pandemic, and the great share of that burden will come on seniors. We are being left behind.”
For these members, a variety of difficult decisions lie ahead. One member said that her husband is now considering undergoing a surgical procedure that he was told by his doctor could wait until after the pandemic subsided. Now, he worries that the surgery will be too expensive without the guild plan and wonders if he will have to risk contracting COVID-19 in the hospital to undergo the operation before his insurance expires.
Even for those without such pressing matters, rising health care costs and long searches through health care marketplaces and applications await. SAG-AFTRA and health plan trustees have told retirees that they will be able to find replacements for their Medicare supplements through the Via Benefits marketplace starting in October, which they promise will provide expanded options and a health reimbursement account for senior performers. Some trustees have spoken out to reassure the membership, including former SAG president Barry Gordon.
“I was skeptical at first, but was pleasantly surprised,” Gordon said in a statement. “I was able to do an anonymous test run with Via Benefits and quickly located a comparable plan at a similar price. In fact, I actually found several options. I hope people give it a chance rather than simply assuming that they won’t find a comparable plan.”
But not everyone has been encouraged by what they’ve seen so far in their early searches for replacement coverage. Kathy Lander said that she and David both enrolled in Medicare Part A and B when they turned 65, using the health plan to cover whatever Medicare didn’t. Without the guild plan to support them, they will now have to turn to Medicare supplements to cover David’s MS care. The cost of that supplement: $12,000 per year.
“I’m 73 now, and it is much more expensive for this supplement plan than it it would have been if David and I had signed up for it when we first qualified for Medicare, because now we are considered by the insurers to be at greater risk.” Lander said.
The production shutdown due to the coronavirus pandemic has only worsened the financial predicament of both the health plan and the union itself. (The guild has laid off 108 people, roughly 20% of its workforce, since March.)
While the pandemic was the trigger, the changes are also connected to years-long trends both within the guild and nationwide. Inside SAG-AFTRA, the health fund has seen its surplus turn into a growing deficit since SAG and AFTRA merged in 2012. In both newsletters announcing the changes and virtual town halls with members, health plan trustees said that employer contributions to the plan have not kept up with the rising costs in health care despite negotiations with health care providers.
“The Trustees of the SAG-AFTRA Health Plan have taken a difficult but necessary action to address financial deficits facing the plan. The impact of healthcare costs that are continuing to skyrocket has been exacerbated by a global pandemic that has brought our industry to a standstill and dramatically diminished contributions to the Health Plan,” read a statement from plan representatives.
“In order to continue to provide high-quality benefits to the greatest number of participants, we must implement changes now in order to preserve the long-term sustainability of the Health Plan.”
The guild’s new contract with the Alliance of Motion Picture and Television Producers — which members approved last month with 74% of the vote — includes a 1% increase in AMPTP contributions to the guild’s health plan, with the option of shifting an additional .5% of the wage increase in years 2 and 3 to the health plan or the SAG Pension Plan/AFTRA Retirement Fund
But despite that increase in contributions from studios, the health plan trustees now say that its not enough to stave off this new premium surge. This has lent new fuel to the SAG-AFTRA Los Angeles local, which vocally opposed the AMPTP contract and views the health plan changes as evidence that not enough was done to get studios to raise caps further on their health plan contributions. Many of the L.A. local leadership are among the 15,000 guild members who have signed a Change.org petition urging that the changes be overturned, and at a virtual town hall this past weekend, the local suggested that it may take legal action to stop the changes.
“Speaking personally and perhaps for every performer lucky enough to actually have a pension — we don’t ‘retire,'” Frances Fisher, vice president of the guild’s L.A. chapter, wrote on the petition page. “I have to keep working to pay my bills. And now my dwindling residuals don’t count as earnings to help keep my health care? During COVID when only lucky stars are working? This is one of many things wrong here.”
Kathy Lander echoed those sentiments. “The plan has been faltering for years, but I never thought that they would drop this on us now. And it does feel really fishy to me that this happened just after we approved a new AMPTP contract where we were given no warning by the leaders that this was coming.”
Sources with knowledge of the health plan have told TheWrap that waiting until after the pandemic subsides to make cuts would force trustees to make steeper cuts, including a larger increase to the earnings requirement, that would force an even larger percentage of members off the plan, and that larger increases to employer contributions would not have been enough to stave off the plan changes. Health plan trustees project another $83 million deficit next year, and warn that financial reserves would run out by 2024 without these changes.
The SAG-AFTRA premium hikes are also tied into a larger debate over the American health care system that has become a major factor in the 2020 presidential election. Andrew McGuire, head of single-payer organizing network California OneCare, argued that the lack of cost controls in the Affordable Care Act has allowed insurance companies to raise premiums well above the rate of inflation. Worse, many guild retirees will be turning to a private Medicare supplement marketplace that is similarly flawed.
“What we’re seeing now with these escalating costs and Medicare supplements is the result of decades of Republicans chipping away at the protections Medicare offers and the ability of the government to negotiate costs with insurers and pharmaceuticals,” he said.
During the Democratic presidential primary, one argument against single payer by eventual nominee Joe Biden was that such a system would take away the health care plans that unions have negotiated. It was an argument that he took to labor town halls and to forums hosted by the AFL-CIO. “I have a significant health care plan,” Biden said last September. “But guess what? Under mine, you can keep your health insurance you bargained for if you like it. If you don’t, you can move, and you can come into a public plan.”
Should Biden defeat Donald Trump and Democrats take control of Congress in November, many expect the party to make changes to the ACA and consider implementing a public option instead of the Medicare-for-All plan pushed by Sen. Bernie Sanders and the more progressive wing of the party. But McGuire believes that many union members like those in SAG-AFTRA who have lost their union-provided health care during the pandemic may be more receptive to a single-payer approach.
“The issue of single payer split a lot of unions during the primary, but there had been some unions that didn’t buy into the idea that their plans needed to be protected,” he said. “This pandemic is going to push some of the more recalcitrant unions towards single payer, and that’s going to make it more politically viable among the Democrats.”
The Fine Line Between Choice and Confusion in Health Care
Part of the U.S. debate over health care is really a debate over the definition of freedom.
by Austin Frakt - NYT - August 24, 2020
American opponents of proposed government-run health systems have long used the word “choice” as a weapon.
One reason “Medicare for all” met its end this year has been the decades-long priming of the public that a health system should preserve choice — of plans and doctors and hospitals. To have choice is to be free, according to many.
So how many Americans actually have choices, and what type of freedom do choices provide?
Making mistakes with Medicare
Current Medicare enrollees have more choices than any other Americans — to some, in fact, an overwhelmingly large number of them.
In 2019, 90 percent of Medicare enrollees had access to at least 10 Medicare Advantage plans, which are government-subsidized, private-plan alternatives to the traditional public program.
But this is just the beginning. If Medicare beneficiaries who elect to enroll in the traditional public program want drug coverage, they must choose from large numbers of private prescription drug plans. In 2014, beneficiaries could choose from an average of 28 drug plans. They can also select private plans that wrap around traditional Medicare, filling in some of its gaps, and this doesn’t even count plan options that may be available through former employers as retiree benefits.
Choosing among all these options would be a challenge for anyone, or, as a Kaiser Family Foundation report put it, “a daunting task.”
“Medicare beneficiaries are so confused, overwhelmed and frustrated with the number of choices and the process of choosing among them, they end up taking shortcuts,” said Gretchen Jacobson, now with the Commonwealth Foundation and an author of the report. “Those shortcuts can lead them to select plans that aren’t as beneficial to them as other options.”
In other words, freedom to choose is also freedom to make mistakes.
For instance, in the first year that drug plans were available to Medicare beneficiaries, economists have shown that 88 percent of them chose a more costly plan than they could have. This cost them 30 percent more, on average, and the tendency to select needlessly costly plans persisted in subsequent years. This is the kind of error, as other studies have found, that is easy to make when inundated by choices.
More generally, without some assistance, many people don’t understand the health insurance choices and features. Even common terms can be confusing. In one study, all the subjects said they understood what a “co-pay” was, but 28 percent could not answer a question testing their knowledge of the term; 41 percent couldn’t define what “maximum out-of-pocket” meant.
Of course, just because people make mistakes when faced with choices doesn’t imply that a single plan for all would be a better fit for more people. It all depends on the details.
Medicaid also offers the vast majority of enrollees private-plan choices. States, on average, offered seven plans for enrollees to choose from in 2017. Some types of enrollees — particularly those with more complex health problems — are not able to choose plans and are put into one that specializes in their needs.
According to a systematic review by Michael Sparer, a professor at Columbia University’s Mailman School of Public Health, studies do not find much cost savings to Medicaid programs stemming from all this choice. But some studies indicate that private Medicaid plans do provide better access to some types of care, including primary care.
A caution, however: “Since Medicaid is a state-based program, broad averages don’t tell you much about what is happening in specific states,” he said. “Some states have been able to save money through the managed care options enrollees can select, and some have not.”
It’s much less clear how many choices people with employer-sponsored plans have, because that data isn’t public. Generally speaking, employers serve as a filter, selecting or working with insurers to devise a small number of plans offered to employees.
What we do know is that three in four employers offer just a single plan. These are mostly small businesses, so only a minority of workers are employed by them. Most workers (64 percent) are employed by firms that offer some choice among plans. But most of these workers are at firms that offer just two options. Does this imply workers at these firms have less freedom?
About 4 percent of firms with more than 50 employees offer coverage in private exchanges, akin to what the Affordable Care Act established for individuals. “Private exchanges generated a lot of hype five years ago,” said Paul Fronstin, director of health research at the Employee Benefit Research Institute. “For some reason, they just never became popular.”
He gets his coverage from an exchange that offers a whopping 60 plans. “Choosing among them is no small task, particularly because information about them is so confusing,” he said.
One employer that stands out in offering choices is the federal government. Federal employees can typically choose from about two dozen plans (the number and details vary by state). There are 28 plans in Washington and 21 in Rhode Island, for example.
This year, all A.C.A. marketplace enrollees have choices among plans, on average about 19 of them. Some have over 100.
All told, a rough calculation suggests that about 80 percent of insured Americans have a choice of health plan.
What is ‘freedom’ in health care?
It’s worth considering what accompanies health insurance choice for some Americans. If you work at a company, you could lose access to affordable coverage if you lose your job or if the company decides to stop offering it.
Other people choose coverage plans that can be too skimpy to pay for a major treatment.
Yet others may have options, but they may not be affordable. None of this is necessarily a condemnation of choice per se, just the nature of health insurance choice in America today.
Medicare for all was supposed to address problems like these. As the Finnish author Anu Partanen wrote of a single-payer system: “The point of having the government manage this complicated service is not to take freedom away from the individual. The point is the opposite: to give people more freedom.”
The Medicare for All Act would have offered no choice, enrolling everyone in the same, comprehensive plan with no out-of-pocket cost. Proponents of this approach trust the government to devise a program suitable for all. Detractors of it favor choices precisely because they have less faith that government will do a better job than plans that are in competition. For them, freedom to choose is freedom from tyranny. But too much choice without enough guidance can be overwhelming.
https://www.nytimes.com/2020/08/24/upshot/health-care-choice-freedom-confusion.html?
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