If Biden Wants to Be Like F.D.R., He Needs the Left
Radical agitation helped bring Social Security and much of the New Deal into being.
by Jamalle Bouie - NYT - November 20, 2020
Not long before Election Day, Joe Biden traveled to Warm Springs, Ga. to deliver a speech on the healing of America.
This place, Warm Springs, is a reminder that though broken, each of us can be healed. That as a people and a country, we can overcome a devastating virus. That we can heal a suffering world. That yes, we can restore our soul and save our country.
The location was intentional. Warm Springs is where Franklin Delano Roosevelt went to rest and recover, beginning in 1924, after his polio diagnosis and subsequent paralysis in 1921. As president he made it, along with his home in Hyde Park, N.Y., a kind of winter White House. He died there in 1945, just a few months after taking the oath of office for a fourth time. The town remains a shrine to the 32nd president, an ideal stop for someone who hopes to channel Roosevelt’s ambition (and also saw electoral opportunity in the state).
We now know that Biden will be president, but he won’t have the votes for F.D.R.-size legislation. This doesn’t mean he’s dead in the water, but it does mean that Biden will have to marshal every resource and rely on every possible ally to win whatever victories he can. And he should know, as Roosevelt did, that this means grappling with the left — all of the left, including its most radical edges.
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The Social Security Act of 1935, which established the nation’s old age and unemployment insurance programs, as well as its first stab at maternal assistance, represents traditional Democratic Party liberalism at its best: simple, broad-based and pragmatic. The basis for the American welfare state — and derided by opponents at the time as an example of “creeping socialism” — it remains a potent example of the power of government to help ordinary people. What the public knows is that it was the product of Roosevelt and the New Deal. Missing from this story is how much the law owes to the activism and agitation of the American left.
On Feb. 10, 1931, four years before Senator Robert Wagner of New York and Representative David Lewis of Maryland introduced President Roosevelt’s social security legislation to Congress, tens of thousands of Americans nationwide took to the streets at the height of the Great Depression to march for unemployment assistance and food aid. Organized by a then-burgeoning Communist Party, demonstrations ranged from peaceful protests to tense confrontations with law enforcement. In Boston, noted The New York Times in a contemporaneous report, “Two hundred Communists and sympathizers and about as many police staged a series of fights and scuffles along the Boston Common.” In St. Paul, Minn., “Communist-led demonstrators jammed their way into the House chamber of the Minnesota Legislature and held possession for more than two hours while they demanded relief for the unemployed.”
In New York City, similarly, “nearly 4,000 men, women and children heard half a dozen speakers call upon the government to grant unemployment insurance, stop evictions and to furnish free food, heat and light to the unemployed.”
These demonstrations weren’t just for the idea of unemployment insurance. The Communists had a particular bill in mind: the Workers’ Unemployment Insurance Bill, which the party had drafted the previous year. The Workers’ Bill, as it was called, promised generous assistance for the unemployed, for the sick and the old, and for new mothers, all financed by taxes on corporate income and inheritances.
With ongoing activism and agitation came greater support; rank-and-file pressure from within the American Federation of Labor, for example, led to the creation of the A.F.L. Trade Union Committee for Unemployment Insurance and Relief, headed by Louis Weinstock of the New York Painters’ Union, himself a communist. The committee endorsed the bill, which was later introduced to Congress by the Minnesota Farmer-Labor congressman Ernest Lundeen on the urging of Herbert Benjamin of C.P.U.S.A., who led the party’s effort to organize the unemployed.
Lundeen’s version of the “Worker’s Bill” quickly became a rallying point for unions and associations of the unemployed across the country. Here is the historian James J. Lorence in “Organizing the Unemployed: Community and Union Activists in the Industrial Heartland”:
Although the Lundeen Bill drew only lukewarm congressional backing, its strong rank-and-file support helped shape the debated that ended in the creation of the American unemployment insurance system.
Over the course of 1934, grass roots organizers arranged marches, letter-writing campaigns and conferences in support of the bill. “The popular pressure crested in January 1935 with a major national demonstration to support the Lundeen Bill,” Lorence writes. “Among the groups endorsing the legislation were MESA [Mechanics Educational Society of America]; AWU [Auto Workers Union]; Railway Carmen; Machinists; Mine, Mill and Smelter Workers; the rebel AFL unions; and a large number of ethnic and fraternal organizations.”
Concurrent with the demonstration was a Communist-organized National Congress for Unemployment and Social Insurance. There, thousands of delegates from dozens of states agitated for its passage. Proponents of the Lundeen bill, like Thomas Arnold Hill of the National Urban League, urged its passage:
There must come before the Congress of the United States, legislation that will guarantee, for all workers regardless of age, occupation, color, sex, or political belief, full compensation for all loss of time occasioned by involuntary unemployment, industrial accident, and sickness. Minimum standards must be set below which this compensation must not fall. Costs must be placed not upon workers, but upon Government and capital; and workers must not be excluded from administering the benefits of such a plan.
Aware of the Roosevelt proposal, which had been percolating within the administration for most of the previous year, proponents held out the Workers’ Bill as the only viable solution to the unemployment crisis. “It is the position of the Communist Party that it is the responsibility of the national government to provide, against all those vicissitudes of life which are beyond individual or group control, a guarantee of a minimum standard of decent livelihood equal to the average of the individual or group when normally employed,” declared Earl Browder, the leader of C.P.U.S.A., in a statement made at Senate Finance Committee hearings on the Wagner-Lewis Bill. “The Communist Party opposes the administration bill because it violates each and every one of these conditions for real social insurance.”
On March 9, 1935, the House Committee on Labor, following hours of testimony from a cross-section of Americans, voted to send the Lundeen bill to the House floor, where it was promptly defeated by an overwhelming majority of Democrats and Republicans. In death, however the Lundeen bill, as well as the activism that brought it to Congress, helped clear the way for Wagner-Lewis, a proposal which even in its modesty redefined the relationship between state and citizen.
The radical and sweeping nature of its proposals enabled the administration forces to say to the indifferent and to the conservative that unless the latter accepted the moderate program put forward by the administration they might later be forced to accept the radical and far-reaching provisions of the Lundeen bill.
From roughly 1930 to 1935, an amalgamation of leftists and laborers — employed or otherwise — made social insurance an urgent priority for the federal government. It is possible that something like the Social Security Act would have passed without this agitation, but knowing how difficult it is to move the American government in any direction without the pressure of organized public opinion, I doubt it.
Let’s return to the present. The conditions of January 2021 will be very different than those of January 1935. The situation isn’t as dire and the left isn’t as strong. Neither is the Democratic Party. What, then, can Democrats take from this story?
Simply put, an ambitious, active left is one that widens the scope of reform. It’s a left that, even if you disagree with it, helps clear the pathways for action. It brings energy and urgency to liberal politics. And if nothing else, it’s a foil against which moderates can triangulate and make the case for more than marginal change, should they want it. Roosevelt was often frustrated with the left, but recognized its power and the importance of its vitality to his own cause.
There was no building the American welfare state without the left, and if it’s to be rebuilt, the left will have to be part of it. Democrats, especially would-be heirs to F.D.R., should take care to remember that fact.
https://www.nytimes.com/2020/11/20/opinion/biden-fdr-left-new-deal.html?
Beyond COVID-19: the Power Struggle Over Alternatives for Health Care Reform
Today we face the COVID-19 pandemic, with its resultant economic downturn and systemic racism—the triple crises that have exposed the serious problems of U. S. health care. It is now obvious to most observers that the system is broken, raising the question of how it can be put together through the political process after a hotly contested election season filled with disinformation and confusion about potential reform alternatives.
Corporatization, privatization, a shift from not-for-profit to for-profit health care, and the growth of investor-owned corporate health care have been dominant themes in the transformation of U. S. health care since the 1980s. We have seen a 3,000 percent growth in the numbers of administrators and managers compared to a minimal growth in the numbers of physicians.
The profit-driven medical-industrial complex continues to lead the way on the S & P 500 as the “system” raises prices to what the traffic will bear, limits choice and access to care, erodes our safety net, and leads to rampant profiteering, corruption and fraud. It has predictably failed us as we attempt to deal with the crises exposing the soft underbelly of our supposed system.
The increasing urgency for fundamental health care reform is shown by these indicators wrought by today’s triple crises and the inadequate response by the Trump administration:
+ More than 55 million uninsured Americans (including the uninsured before the pandemic) and 87 million underinsured.
+ Increased privatization (for profit) of public programs involving two-thirds of Medicare and three-quarters of Medicaid programs.
+ Private health insurers being allowed by the Trump administration to expand marketing of short-term plans, “junk insurance,” with very limited benefits of short duration without any protections for pre-existing conditions.
+ Long delays for newly unemployed workers to receive jobless benefits, with lack of oversight and transparency.
+ Shifting responsibility for health care to the states, allowing them to set premiums and other cost-sharing for Medicaid beneficiaries and impose lifetime caps on Medicaid benefits.
+ Decimation of the safety net, especially in lower-income urban settings and rural areas.
+ Relaxing regulatory standards at the FDA and EPA.
+ Budget cuts for Medicaid and Medicare, the Centers for Disease Control and Prevention (CDC), Social Security, Planned Parenthood, and other essential programs.
After all these years, the GOP has still not come up with its own health care plan, but their policies bear witness to their approaches to health care. They see no problem with corporate control in a multi-payer financing system, a profiteering medical-industrial complex, cost sharing for patients to have “more skin in the game,” and shifting responsibility from the federal government to the states. Without a health plan, the GOP just wants to kill the ACA and let the market’s supposed efficiency work its magic with minimal regulation.
We currently have three reform alternatives before us being contested in this election cycle. Let’s assess the advantages and disadvantages of each.
Build on the Affordable Care Act (ACA)
The ACA did bring health insurance to about 20 million previously
uninsured Americans, mostly through expansion of Medicaid in 31 states. It also set in place protections against private insurers denying coverage based on pre-existing conditions.
Ten years after its passage, however, the ACA is still just another Band Aid on a broken system far short of universal coverage. It has failed to control health care prices and costs, and leaves a profiteering private insurance industry in place. Private health insurance continues to be pricey and unaffordable for many, while disparities and inequities persist with many Americans still delaying or foregoing essential care.
Prior to this pandemic, employer-sponsored insurance (ESI) involved about 150 million workers, by far the largest group covered by private health insurance. But the pandemic has demonstrated the total inadequacy of ESI based on these facts:
+ The labor market is inherently unstable—by the time they reach age 50, Individuals have held an average of 12 jobs; 66 million left or lost jobs in 2018, with many not regaining insurance in another job.
+ ESI is increasingly expensive both for employers and employees, prompting employers to shift more costs to their employees, including ever increasing high deductibles, as employees pay more in lost wages. As a result, ESI has more gaps in coverage, and often cannot be relied upon when serious illness or accidents occur.
+ Small business, representing 88 percent of all businesses on Main Street with fewer than 20 employees and with less than $100,000 in annual revenue, had great difficulty in providing ESI before the pandemic and has been especially hard hit in its aftermath.
Medicare for Some; Variants of a Public Option
Many centrist Democrats have been promoting the advantages of one or another variant of the public option, which would in effect become Medicare for Some. These are the main variants:
+ Lowering the eligibility age for Medicare to 60, as favored by presidential candidate Joe Biden,
+ A Medicare buy-in public option plan for sale alongside private plans on the ACA exchanges,
+ A pay or play plan whereby employers could choose between purchasing private insurance or paying a payroll tax of about 8 percent, and
+ Expansion of privatized Medicare Advantage, labeled by critics as Medicare Disadvantage!
While seen by some as less disruptive and politically more achievable, Medicare for Some would fail to bring sufficient system reform for these reasons:
+ Would leave a failing private health insurance industry in place, with its administrative overhead four to five times higher than that of traditional Medicare.
+ No capacity for cost containment.
+ Lack of comprehensive benefits.
+ Added administrative complexity and bureaucracy.
+ Would fall far short and never reach universal coverage.
Medicare for All
This is the most logical and only alternative that can bring universal
coverage to accessible, affordable health care for our population. It is not a new idea. As a presidential candidate in 1912, T. R. Roosevelt included national health insurance in his platform, as did Harry Truman in 1948. FDR also included it in his New Deal program in the mid-1930s until he backed off because of strong opposition from the AMA.
The current bill in the House of Representatives, H. R. 1384, clarifies Expanded and Improved Medicare for All. When enacted, it will bring:
+ Universal coverage of comprehensive health care for all U. S. residents through a single-payer, publicly financed Medicare for All system of national health insurance (NHI).
+ Full choice of physician, other health care professionals, and hospital anywhere in the country.
Coverage of all medically necessary care, including outpatient and inpatient services; dental, hearing and vision care; laboratory and diagnostic services; reproductive health; maternity and newborn care; mental health services; prescription drugs; and long-term care and supports.
+ Elimination of cost sharing at the point of care, such as copays and deductibles, with no need to get pre-authorization through private insurers.
+ Administrative simplification with efficiencies and cost containment through large-scale cost controls, including (a) negotiated fee schedules for physicians and other health professionals; (b) global budgeting of hospitals and other facilities; and (c) bulk purchasing of drugs and medical devices.
+ Elimination of employer-sponsored health insurance and also the private health insurance industry with its onerous administrative costs and profiteering.
+ Allocation of 1 percent of its budget over the first five years for assistance and retraining of the estimated 1.7 million workers displaced by single-payer NHI.
+ Improved quality of care and outcomes for both individuals and populations due to universal access to essential care and increased funding for public health.
+ Regional funding for rural and urban areas that are medically underserved.
+ Shared risk for the cost of illness and accidents across our entire population of 330 million Americans.
+ Cost savings that enable universal coverage.
Gerald Friedman, Ph.D., professor of economics at the University of Massachusetts Amherst, has done ongoing studies of the costs of single-payer Medicare for All over the last 10 years. He finds that, had it been in place in 2019, we would have saved more than $ 1 trillion that year. Figure 1 shows how these savings would have occurred, in billions, for three areas of health care spending—provider administration (the billing process); payments to hospitals, drug companies and medical equipment manufacturers (through bulk purchasing and negotiated prices); and insurance administration (interaction with multi-payer insurers). Those savings are how we can afford Medicare for All, since the money is already there.
Figure 1.
MEDICARE FOR ALL SAVINGS COMPARED TO CURRENT SYSTEM, 2019
Source: Friedman, G. The Case for Medicare for All. Polity Press, Medford, MA, 2020, pp. 62-63.
We have been repeatedly told over at least four decades that the free market will fix our system’s problems of access, costs, and quality of health care. That claim has been proven false by long experience. For-profit corporate stakeholders, often investor-owned, have demonstrated their commitment to profits over the public interest. The enormous medical-industrial complex that has evolved is a powerful barrier to reform, but the common good can be achieved if positive forces for change coalesce in this nodal crisis time requiring fundamental reform.
These claims by critics and opponents of Medicare for All can be readily refuted by evidence:
We can’t afford Medicare for All; it will bankrupt us.
We can’t afford the system we have. The private health insurance industry has been bailed out by subsidies from the federal government for many years, currently at $685 billion a year, projected by the Congressional Budget Office to double in another ten years. An excellent study by the Political Economy Research Institute at the University of Massachusetts Amherst projects that Medicare for All will save the U. S. $5.1 trillion over a decade through savings from replacing our for-profit market-based multi-payer financing system. Middle class Americans will see savings of up to 14 percent, while 95 percent of Americans will pay less than they do now for health care and insurance.
Medicare for All will be too disruptive.
This scare tactic by opponents ignores how disruptive private health insurance is now, with loss of insurance with job change or loss, narrowing networks, and insurers leaving unprofitable markets. The transition to traditional Medicare in the mid-1960s was seamless, even before computers.
NHI will be a government takeover.
Quite the contrary. Under NHI, physicians and other health care professionals will be enabled to stay in private practice, with simplified billing and less paper work. Private hospitals and other facilities will be stabilized during and beyond the pandemic with stable, year-to-year operating budgets.
NHI will bring rationing.
This claim totally ignores the rationing by ability to pay that plagues millions of Americans who can’t afford care when needed, delaying or forgoing care altogether with worse outcomes later on. NHI will remedy this problem.
Patients will lose choice.
This is absurd, since they will gain choice of physicians, other health professionals, hospital and other facilities, which they value much more than choice of insurer.
Physicians won’t like it.
A majority of physicians already support Medicare for All, beleaguered as they are with changing policies of health insurers, pre-authorizations, restricted networks, changing drug formularies, and other requirements related to reimbursement. Because of these administrative problems, which take so much time from patient care, a growing number of physicians are burning out and retiring early.
While we can expect powerful opposition to Medicare for All from corporate stakeholders in the medical-industrial complex, the status quo and the ‘old normal’ are no longer tenable. With the ongoing impacts of the triple crises, 2021 is a unique political moment when health care reform can be enacted. The stakes couldn’t be higher for Americans, the economy, and recovery beyond the pandemic. Do we have the political will to move to a ‘new normal’ with Medicare for All?
When Medicare Choices Get ‘Pretty Crazy,’ Many Seniors Avert Their Eyes
A new study shows that more than half of enrollees don’t review or compare their coverage options annually.
by Mark Miller - NYT - November 13, 2020
This is the time of year when seniors face a barrage of messages about their Medicare coverage — everything from insurance companies’ direct mail blitzes and television ads to the federal government’s emails and mailings.
All of it focuses on the fall open enrollment season, the annual opportunity to change coverage. From Oct. 15 until Dec. 7, enrollees can shop Medicare’s marketplace for the prescription drug and Advantage plans offered by commercial insurance companies. They can also switch between fee-for-service original Medicare and Advantage.
And they will have plenty of choices: Next year, the typical Medicare enrollee will be able to choose from 57 Medicare prescription or Advantage plans that include drug coverage, according to the Kaiser Family Foundation.
It hasn’t always been this way. At its creation in 1965, Medicare was envisioned as a social insurance program. All eligible workers would pay into the system during their working years via the payroll tax and pay uniform premiums when they enrolled at age 65 — and they would all receive the same coverage.
But privatization of Medicare began in the 1990s, encouraged by federal policy and legislation. The marketplace approach accelerated with the introduction of prescription drug coverage (Part D) in 2006 and the rapid growth of Advantage over the past decade.
Proponents of privatization argue that giving Medicare enrollees plenty of choices, with competition among health insurance companies, keeps consumer prices down and encourages innovation.
That notion hinges on having consumers roll up their sleeves to compare products and make changes in order to get the best prices and coverage. But a new study by the Kaiser Family Foundation finds that often doesn’t happen.
The study, based on Medicare’s own enrollee survey data, found that 57 percent didn’t review or compare their coverage options annually, including 46 percent who “never” or “rarely” revisited their plans. Strikingly, two-thirds of beneficiaries 85 or older don’t review their coverage annually, and up to 33 percent of this age group say they never do. People in poor health, or with low income or education levels, are also much less likely to shop.
“A large share of the Medicare population finds this whole task pretty unappealing, and they just don’t do it,” said Tricia Neuman, director of the Medicare policy program at the Kaiser Family Foundation and a co-author of the report. “That raises questions about how well the system is working.”
The indifference can’t be chalked up to a shortage of information.
Each September, Medicare sends an Annual Notice of Change document (via mail or email), which lists the changes in a person’s current coverage for the year ahead, such as the premium and co-pays. Medicare also mails a thick handbook, “Medicare & You,” containing detailed information about plan options. A flurry of email alerts urging enrollees to shop their coverage using the Medicare Plan Finder website also go out each fall.
Insurance companies flood the airwaves and mailboxes with advertisements and brochures.
None of it is working very well. The Kaiser study found that 44 percent of enrollees had never visited the Medicare website, with another 18 percent reporting that they did not have access to the internet or had no one to go online for them. Only half reported that they had reviewed “Medicare & You.” Just 28 percent have ever called the Medicare help line (800-MEDICARE) for information; the rest have never called or were not even aware the line exists.
Why shopping is important
If you’re enrolled only in original Medicare with a Medigap supplemental plan, and don’t use a drug plan, there’s no need to re-evaluate your coverage, experts say. But Part D drug plans should be reviewed annually. The same applies to Advantage plans, which often wrap in prescription coverage and can make changes to their rosters of in-network health care providers.
“Plans can not only change the monthly premium but the list of covered drugs,” said Frederic Riccardi, president of the Medicare Rights Center. “And they can change the rules around your access to drugs, or impose quantity limits or require prior authorizations.”
Why we don’t do it
Complexity is a key issue. Kaiser found that 30 percent of enrollees said the Medicare program was either “somewhat difficult” or “very difficult” to understand, and those percentages were higher among younger people on Medicare who have disabilities or are in poor health.
These plans are required to meet federal requirements in terms of covered benefits, cost sharing and other features. But drug plans have tiers with varying co-payments, coinsurance, and preferred options for brand-name drugs, generics and pharmacies.
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“The amount of information that consumers need to grasp is dizzying, and it turns them off from doing a search,” Mr. Riccardi said. “They feel paralyzed about making a choice, and some just don’t think there is a more affordable plan out there for them.”
But that assumption can be very wrong. In a review of the 10 most heavily enrolled Part D plans for next year, Avalere Health found several with average premiums jumping by double-digit percentages, with others holding steady or dropping a bit. Kaiser calculates that eight out of 10 enrollees in stand-alone Part D plans will pay higher premiums next year in their current plans.
Anthony Hodge, a 65-year-old Medicare Rights Center client who lives in Massapequa, N.Y., expects to save about $1,000 next year by switching Part D plans. Mr. Hodge has a kidney condition that will require a transplant, and he uses seven prescription drugs. The savings stem from differences in premiums and co-pays, including details such as pharmacies used and the “tier” on which each plan places each of his medications.
“It’s pretty crazy when you review all the different plans,” he said. “You can really get bleary-eyed.”
Supporters of the marketplace approach note that drug plan premiums have generally remained affordable since the Part D program was introduced.
“The existence of these markets, regardless of how consumers actually operate and choose, puts substantial downward pressure on the prices offered by the plans, because any marginal move away from them to a competitor has a big effect on their profitability,” said James C. Capretta, a resident fellow at the American Enterprise Institute whose research focuses on health care, entitlement programs and federal budget policy.
“Even if only 5 or 10 percent of consumers take advantage of the marketplace, it is a powerful check on plans raising costs,” he added.
The average monthly premium for Medicare stand-alone prescription drug plans was $38 this year, according to Kaiser, a slight increase from $37 in 2010. Moreover, 89 percent of Medicare Advantage plans next year will include prescription drug coverage, and 54 percent will charge no additional premium beyond the Part B (outpatient services) premium.
But focusing solely on premiums misses the bigger picture of how the Part D program affects enrollees, said Dr. Neuman of Kaiser.
“Insurers understand that consumers are more likely to compare premiums than other plan features that can impact their annual drug costs, so they have an incentive to offer low-premium products,” she said.
Insurers can extract more from enrollees through deductibles allowed under the Part D program, which the government will cap at $445 next year. Most plans (86 percent) will charge a deductible next year, and 67 percent will charge the full amount, Kaiser reported.
Is there another way?
When creation of the prescription drug benefit was being debated, progressive Medicare advocates fought to expand the existing program to include drug coverage, funded by a standard premium, similar to the structure of Part B. The standard Part B premium this year is $144.60; the only exceptions to that are high-income enrollees, who pay special income-related surcharges, and very low-income enrollees, who are eligible for special subsidies to help them meet Medicare costs.
“Given the enormous Medicare population that could be negotiated for, I think most drugs could be offered through a standard Medicare plan,” said Judith A. Stein, executive director of the Center for Medicare Advocacy.
“Instead, we have this very fragmented system that assumes very savvy, active consumers will somehow shop among dozens of plan options to see what drugs are available and at what cost with all the myriad co-pays and cost-sharing options,” she added.
Advocates like Ms. Stein also urged controlling program costs by allowing Medicare to negotiate drug prices with pharmaceutical companies — something the legislation that created Part D forbids.
A model for this approach is the Department of Veterans Affairs, which by law can buy prescription drugs at the same discounted prices available to the Medicaid program, and negotiates deeper discounts on its own.
Getting help with enrollment
If you’re uncomfortable using the internet to search for plans, or don’t have internet access, the State Health Insurance Assistance Programs network is there for you. These federally funded counseling services provide free one-on-one assistance in every state; use this link to find yours.
The Medicare Rights Center offers a free consumer help line: (800-333-4114.)
You can browse plans on the Medicare Plan Finder, the official government website that posts stand-alone prescription drug and Medicare Advantage plan offerings. The plan finder now allows users to sort plans not only by premiums but for total costs, including premiums, deductibles, co-pays and coinsurance payments.
When it comes time to enroll, call Medicare to sign up at 800-MEDICARE (800-633-4227) and to ensure that your enrollment has been processed.
Hospital charges are out of control. Will transparency help?
by Judith Garber - Lown Institute - November 16, 2020
Last year, the Department of Health an Human Services (HHS) announced that they were finalizing a rule to “require hospitals to provide patients with clear, accessible information about their ‘standard charges’ for the items and services they provide.” Under the rule, hospitals will have to provide their standard charges in both machine-readable and consumer-friendly formats. Hospitals will also have to make public the rates they negotiate with insurers and the prices for patients that pay in cash.
To nobody’s surprise, some hospitals objected to this rule, and even sued to try and prevent the rule from going into effect. But it seems like these tactics have not stopped the progress of the new regulation, which will begin January 1, 2021.
Why are hospital prices so contentious? Hospital care makes up 33% of total health care expenditures in the US (about $1 trillion!) so the prices that hospitals charge greatly impact overall health care spending. And the amount hospitals charge keeps going up.
According to a new report from National Nurses United, the largest nurses union in the US, the ratios hospitals charge compared to what is costs hospitals to provide care has exploded in the past few decades. In 1999, hospitals charged twice the cost of health care services on average; in 2018, hospitals charged more than four times the cost of care.
The amount that hospitals charge insurers (what are known as “standard charges”) are rarely what patients actually pay. When hospitals charge insurers, insurers negotiate a lower price, and then may pass on some of the costs to patients (depending on the insurance policy). However, charges still matter because:
- Standard charges are a baseline for the negotiations that happen between hospitals and insurers. Broadly speaking, higher baseline, higher final price. (Hospital prices have grown substantially in the past decade, along with charges.)
- Increasing hospital charges also increases hospital revenue— for every unit increase in the hospital cost-to-charge ratio, hospital revenue per patient discharge increases by $64.
- Patients who are out-of-network (whether they know it or not) often have to pay the full non-discounted price.
- Patients who are uninsured also may have to pay full price on the inflated hospital charges. Even low-income uninsured patients, who should qualify for financial assistance, may not qualify at some hospitals, or may not be notified before they are billed (or even sued).
To sum up, increasing charges is one way hospitals can easily bump up their revenue, at the expense mostly of uninsured and out-of-network patients (many of whom can least afford it). And hospitals in areas with greater Black and Hispanic populations have greater emergency department markup ratios as well, increasing the cost burden on communities of color.
Can transparency help ameliorate the pattern of increasing hospital charges and prices? It’s not a panacea, but there are hints it could help. Here’s why: There is an extreme amount of variation in how much hospitals charge, in relation to their actual cost of care. The National Nurses United report found that the 100 hospitals with the highest cost-to-charge ratios charged 12-18 times their cost of care in 2018. Those with the lowest ratios charged the same as their cost of care, no markup.
What’s different about hospitals that charge more? Unsurprisingly, they tend to be for-profit hospitals. Ninety-five of the top 100 hospitals with highest charge ratios in the NNU report were for-profit operated. More than half of these hospitals were part of the HCA Healthcare system, a large for-profit system (which ranked poorly in civic leadership and value on the Lown Index.) Conversely, the best hospitals for avoiding overcharging were all part of the NYC Health + Hospitals system, New York City’s public system of hospitals (which received outstanding civic leadership and value grades on the Index).
The variation in charges shows how transparency may help: If patients
and policymakers could see side-by-side how much hospitals are marking
up prices, they might be inspired to hold overchargers accountable for
their profiteering.
Maine group launches campaign to put universal health care on the ballot
by Evan Popp - Maine Beacon - November 20, 2020
With many Mainers going without health insurance and an unemployment crisis throwing even more off their plans during a pandemic, a health care advocacy group is launching an effort to gather signatures for a 2022 ballot initiative directing the legislature to establish a universal, publicly-funded health care system that will cover everyone in the state.
The initiative is being put forward by Maine Health Care Action, a campaign launched by the organization Maine AllCare. A summary of the ballot measure says it would direct state lawmakers to “develop legislation to establish a system of universal health care coverage in the State,” calling for “the joint standing committee to report out a bill to the Legislature to implement, by 2024, its proposal.”
Abbie Ryder, campaign manager for Maine Health Care Action, said the group will begin gathering signatures in January for the ballot initiative. A little over 63,000 signatures are needed to put the issue before the voters. But Ryder said the goal is to gather 80,000 given that some signatures will likely be deemed invalid.
She said once the group starts collecting signatures, they have 12 months to gather the necessary amount. If they do, the initiative will be placed on the November 2022 ballot.
Ryder said having a universal health care system in Maine is important because it doesn’t appear that the federal government will pass such a system anytime soon. With a divided Congress and a president-elect who has stopped shortof advocating for universal health care, Ryder said now is the time to take action in Maine.
“People are dying and they’re suffering. Sixty percent of all bankruptcies are due to medical bills,” Ryder said, adding that the continued coronavirus pandemic has laid bare the need for a universal health care system.
Ryder said it is not unprecedented for localities to move ahead of countries when it comes to universal health care. She pointed to former Saskatchewan Premier Tommy Douglas, who passed universal health care in the province years before a nationwide system was implemented in Canada.
Maine Health Care Action also decided to act now because bills put forward by progressive lawmakers to create a universal health care system have stalled in the legislature in recent years, Ryder said.
“Every two years, we’re gonna lose health care advocates in the legislature … it’s starting over from scratch each time,” she said. “And it just didn’t seem like anything was going to come of it going that route.”
If the initiative passes, Ryder said the group expects the legislature to honor the will of the people and work in good faith to set up and implement a universal health care system.
“[The ballot measure] is really about making them know that this many Mainers really want to see this happen,” she said. “And then we’ll be applying pressure and will be going to the public hearings and will be in contact with them as much as possible.”
Gathering signatures in a pandemic
Ryder said Maine Health Care Action’s first job is to collect the signatures needed to get the measure on the ballot. She said while the pandemic will make that process trickier, the group’s plan is to open up an office soon where people can safely come in and add their signature as well as pick up petitions.
Ryder said Maine Health Care Action will also be doing pop-up signature-gathering efforts in various places around the state. She added that next year’s primary and November elections will present additional opportunities to get signatures.
Maine activists rally for universal health care in Lewiston in 2017.
To help with the effort, Ryder said the group has already raised more than $70,000 and hopes to raise around $200,000 in total. If they are successful in collecting the signatures needed, she said Maine Health Care Action hopes to raise around $400,000 to campaign in favor of the ballot measure.
Ryder said the group will focus on raising money in-state, noting that influxes of out-of-state funds usually don’t sit well with Mainers. She added that the organization will follow the fundraising model of amassing a multitude of small donations used by Vermont Sen. Bernie Sanders — an ardent supporter of universal health care — in his presidential campaigns.
Ryder said for the month of December, an in-state donor will match every dollar donated to the group, up to $50,000. She said the money the group raises will go toward launching a large digital and email campaign to get the word out about the signature-gathering effort.
Ryder acknowledged that the initiative will likely draw significant opposition from the health insurance industry, particularly if the group gathers the necessary signatures.
However, she said since Maine Health Care Action is not pushing a specific bill, but rather a resolve directing the legislature to craft a measure, it will be more difficult for the industry to launch a campaign attacking more than the general concept of universal health care.
In 2001, a similar, non-binding referendum supporting the idea of state-level universal health care was placed on the ballot in Portland, Maine’s largest city. It attracted hundreds of thousands of dollars in opposition spending from insurance companies and passed with 52 percent of the vote.
How would universal health care work in Maine?
Ryder also pointed to a 2019 study done by the Maine Center for Economic Policy (MECEP) that examined how a hypothetical universal health care system would work in the state as a document that will be helpful in countering claims by opponents.
James Myall, an economic policy analyst at MECEP — which has not endorsed any specific single-payer health care proposal — and the author of that report, said universal health care is a feasible undertaking at the state level.
“I don’t think it’s the case that it’s impossible for states to do this, at least from an economic standpoint,” he said. “It’s just whether that’s where people want to spend their financial resources and their political capital.”
The MECEP report found that about 652,000 people, including 74,000 people who are uninsured, would receive health coverage under the hypothetical state universal health care system the group devised.
Myall said while such a program would require raising taxes, most people would likely save money overall because they would receive virtually free care and wouldn’t be paying premiums to insurance companies.
He added that such a program would have the additional benefit of unburdening businesses of the cost of providing health insurance to their employees and would also prevent large numbers of people from losing health insurance when there is an economic crisis by decoupling health care from employment.
“I think the COVID situation has really demonstrated to a lot of folks, some of them painfully firsthand, the deficiencies of tying health care to employment,” Myall said.
Recent polling shows that many Mainers are also questioning the wisdom of privatized health insurance.
In an exit poll conducted during the presidential primary in March, 69 percent of voters in Mainers said they support a government plan that covers everyone over a private insurance system.
A less-scientific 2019 survey conducted by volunteers for Maine AllCare that featured respondents from all 16 counties found that 81 percent of those surveyed said they would support “a publicly funded healthcare system that covered everyone in Maine” if the federal government doesn’t pass a universal health care system.
Ryder added that five municipalities — Bangor, Blue Hill, Penobscot, Brunswick and Orono — have passed resolutions in 2020 encouraging the legislature to implement universal health care in Maine.
Those who want to get involved in Maine Health Care Action’s campaign can do so at their website.
https://mainebeacon.com/maine-group-launches-campaign-to-put-universal-health-care-on-the-ballot/UMaine System pauses health insurance change after retirees sue
The lawsuit stems from the decision to switch the retirees from a group benefits plan to a Medicare exchange.
by Megan Gray - Portland Press Herald - November 19, 2020
The University of Maine System will pause a planned change to health insurance for its retired employees in light of a class-action lawsuit.
The decision came just hours after 11 retirees filed their complaint Thursday in Cumberland County Superior Court and asked a judge to block the switch. System leaders have said moving from a group benefits plan to a Medicare exchange will expand benefits and save money, while the retired employees have raised concerns about their contractual rights and higher costs.
“While it’s critical that UMS remains a good steward of the limited resources provided to us by the Legislature, it’s equally important that we listen seriously to the concerns we’ve heard from dozens of our retirees,” Chancellor Dannel Malloy said in a statement. “And many legislators have shared the same concerns. We remain committed to our retirees and providing them affordable, quality health care and will conduct our review quickly to resolve the concerns that have been raised to ensure that retirees have a clear decision in time for January 1, 2021 coverage.”
The announcement said system leaders will work with retiree representatives and union leaders to consider the insurance options for next year. It is not clear what the “pause” will mean for more than 1,550 eligible retirees and their spouses who have already signed up for their new plans. A spokesman clarified that people will still be allowed to sign up for the new plans in the meantime, and people should keep their appointments with benefit advisers. It was not clear when a decision would be made.
The plaintiffs are seeking to represent an estimated 2,900 retired employees, spouses and dependents.
“We are pleased to see the University of Maine System finally understand there are serious problems with the switch in health care plans for our most vulnerable retirees,” Jim McClymer, associate professor of physics and president of the faculty unions, said. “This pause in transition is a step in the right direction and the Unions are eager to speak with the administration about the change, its impact on retirees, and ways we hope they can correct the problems this transition is creating for retirees and current staff.”
Lawmakers and retirees raised concerns earlier this fall about the change being made during the COVID-19 pandemic and without input from or communication with those former employees or the unions. They also questioned the impact of moving to a system in which retirees will have to file for reimbursement of health care costs after paying upfront. The Associated Faculties of the Universities of Maine, which has faculty unions across the system, and other Maine Education Association units have also filed grievances over the issue.
“Filing this lawsuit was not the route we wanted to take, but this was the route the University of Maine System’s Board of Trustees pushed us into,” McClymer said. “We have retirees, who under their new plans, can no longer afford the prescriptions they need to stay alive, and others who are making the tough choices to stop taking one medication so they can afford another at a cost of their own health. This change in plan violates the contract and the promise the University of Maine System made with its retirees, and we will now pursue our rights in the courts.”
The system’s human resources head has previously said retirees are not covered by unions and the system was not obligated to negotiate the change.
Malloy wrote a letter to lawmakers in September that said no retiree or family member will lose health benefits as a result of the change. He also highlighted the anticipated annual savings of $2.5 million, which comes amid flat state appropriations for the UMaine System in the coming fiscal year and $80 million in unplanned pandemic-related expenses and lost revenues since March, offset by just $8.5 million in federal coronavirus relief aid.
The system had said former employees would receive up to $2,100 to cover premiums or other expenses, and their spouses and eligible dependents would receive $800.
“Insurance is a complicated business and we understand the uncertainty among retirees,” system spokesman Dan Demeritt wrote in an email Thursday, before the system announced that it would put the switch on hold. “Benefits specialists are holding hundreds of appointments per week to help our former employees and their spouses choose the right plan for their circumstances. The University of Maine System is also engaging an independent insurance ombudsman to assist retirees with the transition and to provide progress reports to the Board.”
