Category Archives: Kamala Harris

The Real Costs of the U.S. Health-Care Mess, South Africa’s cost of Health Care and Rural Health Care and Gun Violence

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How health insurance works now, and how the candidates want it to work in the future is confusing and yes, very costly.

Matt Bruenig reviewed that with more than 20 people vying for the Democratic presidential nomination, it can be difficult to get a handle on the policy terrain. This is especially true in health care, where at least eight different plans are floating around, including from candidates whom few support, such as Michael Bennet, who wants to offer a public health plan in the small individual-insurance market.

Among the candidates polling in the double digits, three have offered actual health-care proposals (as opposed to vague statements): Joe Biden, Kamala Harris, and Bernie Sanders, whose Medicare for All plan is also supported by Elizabeth Warren. These plans are similar in the most general sense, in that they expand coverage and affordability, but they are dramatically different in their particulars and in what they tell voters about the respective candidates. To understand any of that, however, you have to understand how insurance works right now.

Americans get insurance from four main sources.

The first source is Medicare, which covers nearly all elderly people and some disabled people. The “core” program consists of Medicare Part A, which pays for hospital treatment, and Medicare Part B, which pays for doctor visits. Medicare Part D covers prescription drugs but is administered only by private insurance providers. Private Medigap plans provide supplemental insurance for some of the cost-sharing required by Parts A and B, while private Medicare Advantage plans essentially bundle all of the above into a single offering.

The second source is Medicaid, which covers low-income people and provides long-term care for disabled people. Medicaid is administered by states and jointly funded by state and federal governments. The Affordable Care Act expanded Medicaid eligibility up to the income ladder a bit, but some states did not go along with the expansion.

The third source is employer-sponsored insurance, which covers about 159 million workers, spouses, and children. Employer insurance is very costly, with the average family premium running just under $19,000 a year. For average wage workers living in a family of four, this premium is equal to 26.4 percent of their total labor compensation. If you count this premium as taxes for international comparison purposes, the average wage worker in the United States has the second-highest tax rate in the developed world, behind the Netherlands. As with Medicaid, employer insurance is very unstable, with people losing their insurance plan every time they separate from their job (66 million workers every year) or when their employer decides to change insurance carriers (15 percent of employers every year).

The final source is individual insurance purchased directly from a private insurer. Most of the people who buy this kind of insurance do so through the exchanges established by the Affordable Care Act. The exchanges provide income-based subsidies to individuals with incomes from 100 percent to 400 percent of the poverty line, but have mostly been a policy train wreck: Enrollments were 50 percent lower than predicted, insurers have quit the exchanges in droves, and the income cutoffs have caused disgruntlement among low-income participants who would rather have Medicaid and high-income participants who get no subsidy at all.

Despite all of this, or perhaps because of it, America still has about 30 million uninsured people, a number that is predicted to increase to 35 million by 2029. Conservative estimates suggest that there is one unnecessary death annually for every 830 uninsured people, meaning that America’s level of uninsurance leads to more than 35,000 unnecessary deaths every year.

Biden has centered his candidacy on his association with Barack Obama. Given this strategy, it’s no surprise that he has put out a health plan that is meant to be as similar to Obamacare as possible.

The plan keeps the current insurance regime intact while tweaking some of the rules to fix a few of the pain points identified above. He closes the hole created by some states not expanding Medicaid by enrolling everyone stuck in that hole into a new public health plan for free. He soothes the disgruntlement of high-income people who buy unsubsidized individual insurance by extending subsidies beyond 400 percent of the poverty line. And he slightly increases the subsidy amount for those buying subsidized individual insurance on the exchanges.

In addition to these rule tweaks, Biden also says that the new public option for everyone in the Medicaid hole will also be available in the individual and employer insurance markets, meaning that people in those markets can buy into that public option rather than rely on private insurance.

Biden is probably correct to say that his plan is the most similar to Obamacare. And just like Obamacare, Biden’s plan will leave a lot of Americans uninsured. Specifically, his own materials say that 3 percent of Americans will still be uninsured after his reforms, which means that about 10 million Americans will continue to lack insurance and about 12,000 will die each year due to uninsurance.

Sanders is running as a progressive democratic socialist who wants America to offer the kinds of benefits available in countries such as Denmark, Finland, Sweden, and Norway, or in even less left-wing countries such as Canada. Unlike Biden, he has no need or desire to wrap himself in the policies of the Obama era and has instead come out in favor of a single-payer Medicare for All system.

Under the Sanders plan, the federal government will provide comprehensive health insurance that covers nearly everything people associate with medical care, including prescription drugs, hearing, dental, and vision. Over the course of four years, every American will be transitioned to the new public health plan. Going forward, rather than getting money to providers through a mess of leaky insurance channels, all money will flow through the single Medicare channel, which will cover everyone.

So far, Sanders has not adopted a specific set of “pay-fors” for his Medicare for All program but has instead offered up lists of funding options. Although he has remained open on the specifics of funding Medicare for All, the overall Sanders vision is pretty clear: cut overall health spending while also redistributing health spending up the ladder so that the majority of families pay less for health care than they do now.

And this plan is plausible: The right-wing Mercatus Center found in 2018 that the Sanders plan reduces overall health spending by $2 trillion in the first 10 years. The nonpartisan Rand Corporation has constructed a similar single-payer plan, with pay-fors, for New York State that would result in health-care savings for all family income-groups below 1,000 percent of the poverty line ($276,100 for a family of four).

While Sanders’s support for Medicare for All helps promote his image as a supporter of universal social programs, Warren’s support for it helps boost her brand as a smart technocrat who understands good policy design. As Paul Krugman noted in 2007, a single-payer Medicare for All system is “simpler, easier to administer, and more efficient” than the “complicated, indirect” health-care system we have now. In general, single-payer systems are beloved by the wonk set because they are the most direct and cost-effective way to provide universal health insurance to a population.

If Biden’s plan is Obamacare 2.0 and the Sanders/Warren plan is wonky universalism, then Harris’s plan is a bizarre and confusing muddle that also has come to typify her campaign. Harris is the candidate who went hard after Biden for his views on busing many decades ago and then clarified the next day that her views are the same as Biden’s. She’s the candidate who said she wanted to get rid of private insurers and raised her hand when asked if she would be willing to swap out private insurance for Medicare for All, only to walk back both statements the very next day.

Harris’s health-care proposal, which is basically Medicare Advantage for All, is similar to the Sanders plan, except it takes 10 years to phase in instead of four and allows people to opt out of the public plan in favor of a private plan with identical coverage (similar to how Medicare Advantage works today). This weird hybrid allows Harris to insist that she is for Medicare for All while also saying that she is not getting rid of private insurance.

As readers can probably guess, I favor the Sanders plan on the merits. But what matters for voters may not be the particulars, which most voters will probably never be aware of, but rather what the plans say about the candidates. Voters who want Obama 2.0 will see in Biden’s health-care plan a reassuring fidelity to his predecessor. Voters interested in universal social programs or technocratic wonkiness will have another reason to like Sanders or Warren based on their Medicare for All plan. And voters who like Harris’s style and do not care about consistency can use Harris’s triangulated health-care policy to see what they want in her.

South Africa puts initial universal healthcare cost at $17 billion

I thought that it would be a great idea to see how much other countries are paying for their health care plans. Onke Ngcuka noted that South Africa published its draft National Health Insurance (NHI) bill on Thursday, with one senior official estimating universal healthcare for millions of poorer citizens would cost about 256 billion rands ($16.89 billion) to implement by 2022.

The bill creating an NHI Fund paves the way for a comprehensive overhaul of South Africa’s health system that would be one of the biggest policy changes since the ruling African National Congress ended white minority rule in 1994.

The existing health system in Africa’s most industrialized economy reflects broader racial and social inequalities that persist more than two decades after apartheid ended.

Less than 20 percent of South Africa’s population of 58 million can afford private healthcare, while a majority of poor blacks queue at understaffed state hospitals short of equipment.

Anban Pillay, deputy director-general at the health department, told reporters an initial Treasury estimate of 206 billion rand costs by 2022 was more likely to be 256 billion rands by the time final numbers had been reviewed.

The bill proposes that the NHI Fund, with a board and chief executive officer, also be funded from additional taxes.

“The day we have all been waiting for has arrived: today the National Health Insurance Bill is being introduced in parliament,” said Health Minister Zweli Mkhize at the briefing, adding that the pooling of existing public funds should help reduce costs.

The Hospital Association of South Africa (HASA), an industry body which represents private hospital groups including Netcare, Mediclinic and Life Healthcare, welcomed the release of the bill.

“We are committed to, and supportive of, the core purpose of the legislation, which is to ensure access to quality healthcare for all South Africans,” said HASA chairman Biren Valodia in a statement.

“TAX BURDEN”

The new bill is still to be debated in parliament with public input. It is unclear how long the legislative process will take, with the main opposition party Democratic Alliance suggesting the NHI, which has been in the works for around a decade, would strain the nation’s coffers.

“The DA is convinced that instead of being a vehicle to provide quality healthcare for all, this Bill will nationalize healthcare … and be an additional tax burden to already financially-stretched South Africans,” said Siviwe Gwarube, the DA’s shadow health minister, in a statement.

Successful implementation of NHI would be a boon for President Cyril Ramaphosa following May’s election the ANC won, but its cost comes at a tricky time in a struggling economy.

South Africa’s rand fell to touch an 11-month low on Wednesday, rocked by deepening concerns about the outlook for domestic growth with unemployment at its highest in over a decade and the economy skirting recession.

New taxation options for the Fund include evaluating a surcharge on income tax and small payroll-based taxes.

“There is no doubt that taxpayers will find the additional tax burden a bitter pill to swallow,” said Aneria Bouwer, a partner and tax specialist at Bowmans law firm.

The NHI is due to be implemented in phases before full operation by 2026. The government is looking to eventually shift into the new Fund approximately 150 billion rands a year from money earmarked for the provincial government sphere.

Rural hospitals take the spotlight in the coverage expansion debate

Susannah Luthi points out a fact of these health care plans which everyone refuses to believe. Opponents of the public option have funded an analysis that warns more rural hospitals may close if Americans leave commercial plans for Medicare.

With the focus on rural hospitals, the Partnership for America’s Health Care Future brings a sensitive issue for politicians into its fight against a Medicare buy-in. The policy has gone mainstream among Democratic presidential candidates and many Democratic lawmakers.

Rural hospitals could lose between 2.3% and 14% of their revenue if the U.S. opens up Medicare to people under 65, the consulting firm Navigant projected in its estimate. The analysis assumed just 22% of the remaining 30 million uninsured Americans would choose a Medicare plan. The study based its projections of financial losses primarily on people leaving the commercial market where payment rates are significantly higher than Medicare.

The estimate assumed Medicaid wouldn’t lose anyone to Medicare and plotted out various scenarios where up to half of the commercial market would shift to Medicare.

The analysis was commissioned by the Partnership for America’s Health Care Future, a coalition of hospitals, insurers and pharmaceutical companies fighting public option and single-payer proposals.

In their most drastic scenario of commercial insurance losses, co-authors Jeff Goldsmith and Jeff Leibach predict more than 55% of rural hospitals could risk closure, up from 21% who risk closure today according to their previous studies.

Leibach said the analysis was tailored to individual hospitals, accounting for hospitals that wouldn’t see cuts since they don’t have many commercially insured patients.

The spotlight on rural hospitals in the debate on who should pay for healthcare is common these days, particularly as politicians or the executive branch eye policies that could cut hospital or physician pay.

On Wednesday, Sen. Elizabeth Warren (D-Mass.) seemingly acknowledged this when she published her own proposal to raise Medicare rates for rural hospitals as part of her goal to implement single-payer or Medicare for All. She is running for the Democratic nomination for president for the 2020 election.

“Medicare already has special designations available to rural hospitals, but they must be updated to match the reality of rural areas,” Warren said in a post announcing a rural strategy as part of her campaign platform. “I will create a new designation that reimburses rural hospitals at a higher rate, relieves distance requirements and offers the flexibility of services by assessing the needs of their communities.”

Warren is a co-sponsor of the Medicare for All legislation by Sen. Bernie Sanders (I-Vt.), who is credited with the party’s leftward shift on the healthcare coverage question. But she is trying to differentiate herself from Sanders, and the criticisms about the potentially drastic pay cuts to hospitals have dogged single-payer debates.

Most experts acknowledge the need for a significant policy overhaul that lets rural hospitals adjust their business models. Those providers tend to have aging and sick patients; high rates of uninsured and public pay patients over those covered by commercial insurance; and fewer patients overall than their urban counterparts.

But lawmakers in Washington aren’t likely to act during this Congress. The major recent changes have mostly been driven by the Trump administration, where officials just last week finalized an overhaul of the Medicare wage index to help rural hospitals.

As political rhetoric around the public option or single-payer has gone mainstream this presidential primary season, rural hospitals will likely remain a talking point in the ideas to overhaul or reorganize the U.S.’s $3.3 trillion healthcare industry.

This was in evidence in May, when the House Budget Committee convened a hearing on Medicare for All to investigate some of the fiscal impacts. One Congressional Budget Office official said rural hospitals with mostly Medicaid, Medicare, and uninsured patients could actually see a boost in a redistribution of doctor and hospital pay.

But the CBO didn’t analyze specific legislation and offered a vague overview of how a single-payer system might look, rather than giving exact numbers.

The plight of rural hospitals has been used in lobbying tactics throughout this year — in Congress’ fight over how to end surprise medical bills as well as opposition to hospital contracting reforms proposed in the Senate.

And it has worked to some extent. Both House and Senate committees have made concessions to their surprise billing proposals to mollify some lawmakers’ worries.

New research finds restructuring Medicare Shared Savings Program can yield 40% savings in healthcare costs, bolstering payments to providers

As I reviewed in the last few posts, the evaluation of Medicare was underestimated regarding the cost of the program many times.  Ashley Smith reported that more than a trillion dollars were spent on healthcare in the United States in 2018, with Medicare and Medicaid accounting for some 37% of those expenditures. With healthcare costs expected to continue to rise by roughly 5% per year, a continued debate in healthcare policy is how to reduce costs without compromising quality.

As part of this effort, the Medicare Shared Savings Program was created to control escalating Medicare spending by giving healthcare providers incentives to deliver more efficient healthcare.

New research published in the INFORMS journal Operations Research offers a new approach that could substantially change the healthcare spending paradigm by utilizing performance-based incentives to drive down spending.

The researchers Anil Aswani and Zuo-Jun (Max) Shen of the University of California, Berkeley, and Auyon Siddiq of the University of California, Los Angeles found that redesigning the contract for the shared savings program to better align provider incentives with performance-based subsidies can both increase Medicare savings and increase providers’ reimbursement payments.

“Introducing performance-based subsidies can boost Medicare savings by up to 40% without compromising provider participation in the shared savings program,” said Aswani, a professor in the Industrial Engineering and Operations Research Department at UC Berkeley. “This contract can lead to improved outcomes for both Medicare and participating providers,” he continued.

So, again Medicare will be tweaked and reworked for the present aging population.

What will happen with the Medicare program if it applies to all and at what cost?

And finally, we physicians are on the front lines of caring for patients affected by the intentional or unintentional firearm-related injury. We care for those who experience a lifetime of physical and mental disability related to firearm injury and provides support for families affected by firearm-related injury and death. Physicians are the ones who inform families when their loved ones die as a result of the firearm-related injury. Firearm violence directly impacts physicians, their colleagues, and their families. In a recent survey of trauma surgeons, one-third of respondents had themselves been injured or had a family member or close friend(s) injured or killed by a firearm (38). As with other public health crises, firearm-related injury and death are preventable. The medical profession has an obligation to advocate for changes to reduce the burden of firearm-related injuries and death on our patients, their families, our communities, our colleagues, and our society. Our organizations are committed to working with all stakeholders to identify reasonable, evidence-based solutions to stem firearm-related injury and death and will continue to speak out on the need to address the public health threat of firearms and I will discuss this in more detail in the following weeks.

First, we have to ignore the NRA and make a difference in order to decrease the increasing gun violence!!!!! I predict that if the President and the Republican Senate doesn’t make inroads they are doomed to fail in the 2020 election.

 

 

Medicare for All, funding and ‘impossible promises’ deeply divide Democrats during 2020 debate; and How Many More Shootings of Innocent people Can Our Society Tolerate?

 

promise312What a horrible week it has been! The debates were an embarrassment for all, both Democrats as well as everyone else. Who among those twenty who were on stage, spouting impossible strategies, attacking each other and in general making fools of themselves.

But the worst was the mass shootings this past weekend. Why should anybody be allowed to own assault weapons? We all need to finally do something about this epidemic of mass shootings. How many more innocent people do we have to lose before the Republicans, as well as the Democrats and our President, work together to solve this problem.

As the President of the American Medical Association stated:

“The devastating gun violence tragedies in our nation this weekend are heartbreaking to physicians across America. We see the victims in our emergency departments and deliver trauma care to the injured, provide psychiatric care to the survivors, and console the families of the deceased. The frequency and scale of these mass shootings demand action.

“Everyone in America, including immigrants, aspires to the ideals of life, liberty, and pursuit of happiness. Those shared values – not hatred or division – are the guiding light for efforts to achieve a more perfect union.

“Common-sense steps, broadly supported by the American public, must be advanced by policymakers to prevent avoidable deaths and injuries caused by gun violence. We must also address the pathology of hatred that has too often fueled these mass murders and casualties.”

Brittany De Lea when reviewing the Democrat presidential hopefuls noted that Democratic contenders for the 2020 presidential election spent a sizable amount of time during the second round of debates detailing the divide over how the party plans to reform the U.S. health care system – while largely avoiding to address how they would pay for their individual proposals.

Massachusetts Sen. Elizabeth Warren dodged a point-blank question from moderators as to whether middle-class families would pay more in taxes in order to fund a transition to a Medicare for All system.

Instead, she said several times that “giant corporations” and “billionaires” would pay more. She noted that “total costs” for middle-class households would go down.

Independent Vermont Sen. Bernie Sanders said during the first round of Democratic debates in Miami that taxes on middle-class families would rise but added that those costs would be offset by lower overall health care costs. Warren seemed to refer to this plan of action also.

Sanders and Warren quickly became targets on the debate stage for his proposed plan, which she supports, to transition to a Medicare for All system where there is no role for private insurers.

Former Maryland Congressman John Delaney (and even though I am not a big fan of Mr. Delaney, he is the only one that makes any sense with regard to health care) said Sanders’ plan would lead to an “underfunded system,” where wealthy people would be able to access care at the expense of everyone else. He also said hospitals would be forced to close.

Delaney asked why the party had to be “so extreme,” adding that the Democrats’ health care debate may not be so much about health care as it was an “anti-private sector strategy.” In his opening statement, he appeared to throw jabs at Sanders and Warren for “impossible promises” that would get Trump reelected.

Former Texas lawmaker Beto O’Rourke said taxes would not rise on middle-class taxpayers, but he also does not believe in taking away people’s choice for the private insurance they have.

Minnesota Sen. Amy Klobuchar said there needed to be a public option, as did former Colorado Gov. John Hickenlooper.

South Bend, Indiana, Mayor Pete Buttigieg thought the availability of a public alternative would incentivize people to walk away from their workplace plans.

Earlier this week, California Sen. Kamala Harris unveiled her vision for a transition to a Medicare for All system over a 10-year phase-in period, which called for no tax increase on families earning less than $100,000. She instead said a Wall Street financial transaction tax would help fund the proposal.

Harris is scheduled to appear during Wednesday’s night debate in Detroit, alongside former Vice President Joe Biden whose campaign has already criticized her health care plan.

Health care comes in focus, this time as a risk for Democrats

Ricardo Alonso-Zaldivar reported that the Democratic presidential candidates are split over eliminating employer-provided health insurance under “Medicare for All.”

The risk is that history has shown voters are wary of disruptions to job-based insurance, the mainstay of coverage for Americans over three generations.

Those divisions were on display in the two Democratic debates this week, with Sens. Bernie Sanders and Elizabeth Warren calling for a complete switch to government-run health insurance for all. In rebuttal, former Vice President Joe Biden asserted, “Obamacare is working” and promised to add a public option. Sen. Kamala Harris was in the middle with a new Medicare for All concept that preserves private insurance plans employers could sponsor and phases in more gradually. Other candidates fall along that spectrum.

The debates had the feel of an old video clip for Jim McDermott, a former Democratic congressman from Washington state who spent most of his career trying to move a Sanders-style “single-payer” plan and now thinks Biden is onto something.

“There is a principle in society and in human beings that says the devil you know is better than the devil you don’t know,” said McDermott, a psychiatrist before becoming a politician. “I was a single-payer advocate since medical school. But I hit every rock in the road trying to get it done. This idea that you are going to take out what is known and replace it with a new government program — that’s dead on arrival.”

Warren, D-Mass., was having none of that talk Monday night on the debate stage. “Democrats win when we figure out what is right, and we get out there and fight for it,” she asserted.

Confronting former Rep. John Delaney, D-Md., a moderate, Warren said, “I don’t understand why anybody goes to all the trouble of running for president of the United States just to talk about what we really can’t do and shouldn’t fight for. … I don’t get it.”

Here’s a look at options put forward by Democrats and the employer-based system that progressives would replace:

MEDICARE FOR ALL

The Medicare for All plan advocated by Sanders and Warren would replace America’s hybrid system of employer, government and individual coverage with a single government plan paid for by taxes. Benefits would be comprehensive, and everybody would be covered, but the potential cost could range from $30 trillion to $40 trillion over 10 years. It would be unlawful for private insurers or employers to offer coverage for benefits provided under the government plan.

“If you want stability in the health care system, if you want a system which gives you freedom of choice with regard to doctor or hospital, which is a system which will not bankrupt you, the answer is to get rid of the profiteering of the drug companies and the insurance companies,” said Sanders, a Vermont senator.

BUILDING ON OBAMACARE

On the other end is the Biden plan, which would boost the Affordable Care Act and create a new public option enabling people to buy subsidized government coverage.

“The way to build this and get to it immediately is to build on Obamacare,” he said.

The plan wouldn’t cover everyone, but the Biden campaign says it would reach 97% of the population, up from about 90% currently. The campaign says it would cost $750 billion over 10 years. Biden would leave employer insurance largely untouched.

Other moderate candidates take similar approaches. For example, Colorado Sen. Michael Bennet’s plan is built on a Medicare buy-in initially available in areas that have a shortage of insurers or high costs.

THE NEW ENTRANT

The Harris plan is the new entrant, a version of Medicare for All that preserves a role for private plans closely regulated by the government and allows employers to sponsor such plans. The campaign says it would cover everybody. The total cost is uncertain, but Harris says she would not raise taxes on households making less than $100,000.

“It’s time that we separate employers from the kind of health care people get. And under my plan, we do that,” Harris said.

Harris’ plan might well reduce employer coverage, while Sanders’ plan would replace it. Either would be a momentous change.

Job-based coverage took hold during the World War II years, when the government encouraged employers and unions to settle on health care benefits instead of wage increases that could feed inflation. According to the Congressional Budget Office, employers currently cover about 160 million people under age 65 — or about half the population.

A poll this week from the nonpartisan Kaiser Family Foundation underscored the popularity of employer coverage. Among people 18-64 with workplace plans, 86% rated their coverage as good or excellent.

Republicans already have felt the backlash from trying to tamper with employer coverage.

As the GOP presidential nominee in 2008, the Arizona Sen. John McCain proposed replacing the long-standing tax-free status of employer health care with a tax credit that came with some limits. McCain’s goal was to cut spending and expand access. But Democrats slammed it as a tax on health insurance, and it contributed to McCain’s defeat by Barack Obama.

“The potential to change employer-sponsored insurance in any way was viewed extremely negatively by the public,” said economist Douglas Holtz-Eakin, who served as McCain’s policy director. “That is the Achilles’ heel of Medicare for All — no question about it.”

These Are the Health-Care Questions That Matter Most

Max Nisen then noted that Health care got headline billing at both of this week’s second round of Democratic presidential debates. Unfortunately for voters, neither was very illuminating.

The biggest culprit was the format. Jumping between 10 candidates every 30 seconds made any substantive debate and discussion impossible. The moderators also deserve blame; they asked myopic questions intended to provoke conflict instead of getting any new information. And the candidates didn’t exactly help; there was a lot of sniping and not a lot of clear explanation of what they wanted to do.

The next debates may well be an improvement, as a more stringent cutoff should help to narrow the field and give candidates added time to engage in thoughtful discourse. Regardless, here are the issues that matter, and should be at the heart of any discussion:

The issue of how candidates would propose paying for their various health-care plans has been framed in the debates by the question, “Will you raise middle-class taxes?” That’s a limited and unhelpful approach. Raising taxes shouldn’t be a yes or no question; it’s a trade-off. Americans already pay a lot for health care in the form of premiums, deductibles, co-payments, and doctor’s bills. Why is that regressive system, which rations care by income, different or better than a more progressive tax?  Insurer and drug maker profits, both of which got airtime at the debates, are only a part of the problem when it comes to America’s high health costs.  The disproportionately high prices Americans pay for care are a bigger issue. What we pay hospitals and doctors, and how we can bring those costs down, are crucial issues that the candidates have barely discussed. What’s their plan there? The first round of debates saw the moderators ask candidates to raise their hands if they would eliminate private health coverage. Round two did essentially the same thing without the roll call. The idea of wiping out private insurance seems to be a flashpoint, but there doesn’t seem to be as much interest in questioning the merits of the current, mostly employer-based system. It’s no utopia. Americans unwillingly lose or change employer coverage all the time, and our fragmented system does an awful job of keeping costs down. People who support eliminating or substantially reducing the role of private coverage deserve scrutiny, but so do those who want to retain it. What’s so great about the status quo?

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As the field narrows, voters need specifics. A chunk of the field has been remarkably vague. Answers to these questions could offer some clarity:

For Senator Elizabeth Warren: Are there any differences between your vision of “Medicare for All” and Senator Bernie Sanders’s? There’s wiggle room here; his plan is more expansive (and expensive) than single-payer systems in countries like Canada.  For Senator Kamala Harris: What will your plan cover and how much will it cost? The skeletal outline of Harris’s plan lacks details on premiums and what patients would have to pay for out of pocket. She didn’t clarify matters at the debate.  For former Vice President Joe Biden: Will people with access to employer insurance be eligible for subsidies in your public option plan? If the answer is no or restrictive, his public option could have a relatively limited impact. It the answer is yes, his $750 billion cost estimate should head to the dustbin.  For the morass of candidates who pay lip service to Medicare for All but want to keep private insurance but don’t have a specific plan: What exactly do you want?

Health care is the most important issue for Democrats, according to polling. We need to find a way to have a discussion that does it justice.

Democrats’ Health-Care Feud Eclipses Message That Won in 2018

So, what have we learned from these debates? John Tozl realizes that in the four evenings of Democratic presidential debates since June, one phrase appeared for the first time on Wednesday: “pre-existing conditions.”

New Jersey Senator Cory Booker uttered it in his remarks on health care, chiding fellow Democrats for their infighting as Republicans wage a legal battle to undo the Affordable Care Act, which prohibits insurers from charging people more for being sick.

“The person who is enjoying this debate the most tonight is Donald Trump,” he said. “There is a court case working through the system that’s going to gut the Affordable Care Act and actually gut protections on pre-existing conditions,” Booker said, citing litigation in which the Trump administration and Republican-controlled states seeking to strike down Obamacare.

Over two nights this week, the 20 candidates spent at least an hour fiercely arguing over health-care plans, most of which are significantly more expansive than what the party enacted a decade ago in the Affordable Care Act. It’s a sign of how important the issue will be in the bid to unseat Trump, and how the party’s position has shifted leftward.

In November, Democrats won control of the House on the strength of their message to protect people with pre-existing conditions. That provision, a fundamental change to America’s private insurance market, is central to the ACA, the party’s most significant domestic policy achievement in a generation.

Booker’s attempt to unify his fractious colleagues against their common opponent stood out, because most of the discussion of health care, which kicked off the debate as it did on Tuesday, but the party’s divisions into sharp focus.

Biden v. Harris

Senator Kamala Harris of California and former Vice President Joe Biden tried to discredit each other’s proposals. Biden says he wants to build on the Affordable Care Act while expanding access to health insurance through a public insurance option.

Harris, in a plan, unveiled this week, likewise favors a public option but wants to sever the link between employment and health insurance, allowing people instead to buy into public or private versions of Medicare, the federal health-care program for seniors.

Harris took Biden to task over a plan that fails to insure everyone, saying his plan would leave 10 million people without insurance.

“For a Democrat to be running for president in America with a plan that does not cover everyone, I think is without excuse,” she said.

Biden accused Harris of having had “several plans so far” and called her proposal a budget-buster that would kick people off health plans they like.

“You can’t beat President Trump with double-talk on this plan,” he said.

Other candidates split along similar lines, with Colorado Senator Michael Bennet saying Harris’s proposal “bans employer-based insurance and taxes the middle class to the tune of $30 trillion.”

New York Mayor Bill de Blasio argued for a more sweeping approach, like the Medicare for All policies embraced by Senators Bernie Sanders and Elizabeth Warren.

“I don’t understand why Democrats on this stage are fear-mongering about universal health care,” he said. “Why are we not going to be the party that does something bold, that says we don’t need to depend on private insurance?”

How Bold?

The question any candidate will eventually have to answer is how bold a plan they believe voters in a general election want.

In 2018, Democrats running for Congress attacked Republicans for trying to repeal the ACA and then, when that failed, asking courts to find it unconstitutional. Scrapping the law would mean about 20 million people lose health insurance.

About two-thirds of the public, including half of Republicans, say preserving protections for people with pre-existing conditions is important, according to polls by the Kaiser Family Foundation, a nonprofit health research group.

More than a quarter of adults under 65 have pre-existing conditions, Kaiser estimates.

But that message has been mostly absent from the primary debates, where health-care talk highlights the divisions between the party’s progressive left-wing and its more moderate center.

Warren and Sanders weren’t on stage Wednesday, but their presence was looming. They’re both leading candidates and have deeply embraced Medicare for All plans that replace private insurance with a government plan. Bernie is an idiot, especially in his come back that he knows about Medicare for All since he wrote the bill. He has no idea of the far-reaching effect of Medicare for all. Our practice just reviewed our payments from Medicare over the last few years as well as the continued discounts that are applied to our services and noted that if we had to count on Medicare as our only health care payer that we as well as many rural hospitals would go out of business.

I refer you all back to John Delaney’s responses to the Medicare for All discussion. In the middle of a vigorous argument over Medicare for All during the Democratic debate tonight, former Representative John Delaney pointed out the reason he doesn’t support moving all Americans onto Medicare: It generally pays doctors and hospitals less than private-insurance companies do.

Because of that, some have predicted that if private insurance ends, and Medicare for All becomes the law of the land, many hospitals will close, because they simply won’t be able to afford to stay open at Medicare’s rates. Fact-checkers have pointed out that while some hospitals would do worse under Medicare for All, some would do better. But Delaney insisted tonight that all the hospital administrators he’s spoken with have said they would close if they were paid at the Medicare rate for every bill.

Whichever candidate emerges from the primary will have to take their health plans not just to fervent Democrats, but to a general electorate as well.

More on Medicare

If you remember from last week I reviewed the inability of our federal designers to accurately estimate the cost of the Medicare program and the redesign expanding the Medicaid programs mandating the states expand their Medicaid programs to provide comprehensive coverage for all the medically needy by 1977.

The additional provision of the 1972 legislation was the establishment of the Professional Standards Review Organizations (PSROs), whose function it was to assume responsibility for monitoring the costs, degree of utilization, and quality of care of medical services offered under Medicare and Medicaid. It was hoped that these PSROs would compel hospitals to act more efficiently. In keeping with this set of goals, in 1974 a reimbursement cap was instituted that limited hospitals from charging more than 120 percent of the mean of routine costs in effect in similar facilities, a limit eventually reduced to 112 percent named as Section 223 limits. But despite these attempts at holding down costs, they continued to escalate inasmuch as hospitals were still reimbursed on the basis of their expenses and the caps that were instituted applied only to room and board and not to ancillary services, which remained unregulated.

Now think about the same happening on a bigger scale with the proposed Medicare for All. Those that are proposing this “Grand Plan” need to understand the complexities issues, which need to be considered before touting the superiority of such a plan. Otherwise, the plan will fail!! Stop your sputtering arrogance Bernie, Kamala, and Elizabeth, etc. Get real and do you research, your homework before you yell and scream!!!!!!

More to Come!

Governors Weigh Health Care Plans as They Await Court Ruling, the Future of the ACA and San Francisco Experience with Healthcare Insurance and, Yes, More on Medicare

Screen Shot 2019-07-07 at 8.29.30 PMBrady McCombs reported that as they gather at a conference in Utah, governors from around the U.S. are starting to think about what they will do if an appeals court upholds a lower court ruling overturning former President Barack Obama’s signature health care law, the Affordable Care Act or Obamacare.

More than 20 million Americans would be at risk of losing their health insurance if the 5th U.S. Circuit Court of Appeals agrees with a Texas-based federal judge who declared the Affordable Care Act unconstitutional last December because Congress had eliminated an unpopular tax is imposed on people who did not buy insurance.

The final word on striking down the law will almost certainly come from the Supreme Court, which has twice upheld the 2010 legislation.

Nevada Gov. Steve Sisolak, a Democrat, signed a bill earlier this year prohibiting health insurers from denying coverage to patients due to pre-existing conditions, a pre-emptive move in case the Affordable Care Act was struck down.

He said this week in Salt Lake City at the summer meeting of the National Governors Association that he would ask his recently created patient protection commission to come up with recommendations for how to ensure patients don’t lose coverage if the law is overturned, which would impact about 200,000 people enrolled in Medicaid expansion in Nevada.

“To rip that away from them would be devastating to a lot of families,” Sisolak said.

Nevada is among a coalition of 20 Democratic-leaning states led by California that appealed the lower court ruling and is urging the appeals court to keep the law intact.

At a news conference Thursday, Democrats touted the protections they’ve passed to prevent people from losing health coverage.

New Mexico Gov. Michelle Lujan Grisham signed laws this year that enshrine provisions of the Affordable Care Act into state law, including guarantees to insurance coverage for patients with pre-existing conditions and access to contraception without cost-sharing. She said half of the state’s residents use Medicaid, prompting New Mexico officials to research creating a state-based health care system.

California Gov. Gavin Newsom said his state is already deep in contingency planning because five million people could lose health insurance if the law is struck down and the state doesn’t have enough money to make up for the loss of federal funds. He said the decision this year to tax people who don’t have health insurance, a revival of the so-called individual mandate stripped from Obama’s model, was the first step. That tax will help pay for an expansion of the state’s Medicaid program, the joint state, and federal health insurance program for the poor and disabled.

Newsom said the state is looking at Massachusetts’ state-run health care program and investigating if a single-payer model would work as possible options if the law were spiked.

“The magnitude is jaw-dropping,” Newsom said. “You can’t sit back passively and react to it.”

Arkansas Gov. Asa Hutchinson, a Republican, said states need Congress to be ready to quickly pass a new health care plan if the court overturns Obama’s law since doing so would cut off federal funding for Medicaid expansion.

A court decision in March blocked Arkansas from enforcing work requirements for its Medicaid expansion program, which has generated seemingly annual debate in that state’s Legislature about whether to continue the program.

“Congress can’t just leave that out there hanging,” Hutchinson said.

The 2018 lawsuit that triggered the latest legal battle over the Affordable Care Act was filed by a coalition of 18 Republican-leaning states including Arkansas, Arizona, and Utah.

Arizona Gov. Doug Ducey, a Republican, said he wants to see how the court rules before he makes any decisions about how his state would deal with the loss of Medicaid funds but that Arizona has backup funds available.

“They’re going to rule how they’re going to rule and we’ll deal with the outcome,” Ducey said. “The best plans are to have dollars available.”

It is unknown when the three-judge panel will rule.

The government said in March that 11.4 million people signed up for health care via provisions of the Affordable Care Act during open enrollment season, a dip of about 300,000 from last year.

Utah Gov. Gary Herbert, a Republican, said if the law is overturned, it would provide a perfect opportunity for Congress to try to craft a better program with support from both political parties.

He said his state, which rolled out its partial Medicaid expansion in April, probably will not start working on a contingency plan for people who would lose coverage until the appeals court rules.

“It’s been talked about for so long, people are saying ‘Why to worry about it until it happens?'” Herbert said. “I think there’s a little bit more of a lackadaisical thought process going on.”

President Donald Trump, who never produced a health insurance plan to replace Obama’s health care plan, is now promising one after the elections.

Newsom warned Americans not to rely on that.

“God knows they have no capacity to deal with that,” Newsom said. “The consequences would be profound and pronounced.”

Appeals Court Judges Appear Skeptical About ACA’s Future

Alicia Ault noted that if its line of questioning serves as a barometer, a three-judge panel of the US Fifth Circuit Court of Appeals here seemed to be more favorably inclined toward the arguments of a group of 18 Republican states and two individuals seeking to invalidate the Affordable Care Act (ACA) than to those bent on defending the law.

“I think the plaintiffs had a better day than the defendants,” Josh Blackman, an associate professor of law at the South Texas College of Law, Houston, told Medscape Medical News.

“I think they found that the plaintiffs had standing,” said Blackman, who attended the arguments. The judges also seemed to believe the plaintiffs have been injured by the ACA, and that the individual mandate still demanded that people buy health insurance, even though Congress has eliminated the penalty, he said.

“Short news is it went very badly,” said Ian Millhiser, a senior fellow at the liberal-leaning Center for American Progress, on Twitter, after attending the hearing.

“The two Republican judges appear determined to strike Obamacare,” he said, adding, “There is a chance they will be too embarrassed to do so, but don’t bet on it.”

At the outset, Judge Jennifer Walker Elrod asked Samuel Siegel, a lawyer with the California Department of Justice representing the 20 states and Washington, DC, who are defending the ACA, “If you no longer have the tax, why isn’t [the ACA] unconstitutional?”

Only two of the three judges on the panel asked questions during the 1-hour-and-46-minute hearing — Elrod, appointed by President George W. Bush in 2007, and Kurt Engelhardt, appointed by President Donald J. Trump in 2018. Carolyn Dineen King, appointed by President Jimmy Carter in 1979, did not ask a single question.

The defendants — led by California — were first to argue. They were given 45 minutes to make their case that District Court Judge Reed O’Connor in Texas had erred in December when he ruled that the ACA should be struck down because Congress had eliminated the penalty associated with the requirement that individuals buy health insurance.

Essentially, said Judge O’Connor, the mandate could not be severed from the rest of the ACA. O’Connor did not grant the plaintiffs’ request that the ACA be halted while the case made its way through the courts.

The plaintiffs — led by Texas Solicitor General Kyle Hawkins — also had 45 minutes before the appellate court judges.

Is the ACA Now a “Three-Legged Stool?”

Both Judges Elrod and Engelhardt interrupted Siegel several times while arguing for the ACA to ask him to explain why California and the other states had the standing to defend the federal law. Siegel said that if the law were to be struck down it would cost the defendants hundreds of billions of dollars.

The two judges seemed intent on getting both sides to explain why Congress would have eliminated the penalty that went along with the individual mandate but left the rest of the law standing. The plaintiffs contend that the law could not be severed into parts, that it lived or died with the mandate and its penalty.

When asked to assess congressional intent, Hawkins said, “I’m not in the position to psychoanalyze Congress.” But he said the US Supreme Court had already settled the question, ruling in King v Burwell that the ACA was like a three-legged stool without the penalty. And, he said, even without the penalty, the individual mandate remained part of the law, which he called “a command to buy insurance.”

Douglas Letter, the general counsel to the US House of Representatives, arguing in defense of the ACA, said the opposite: that the Supreme Court had determined in NFIB v Sebelius that the ACA presented a choice of buying health insurance or facing a penalty. Without the penalty, “The choice is still there,” said Letter, adding that individuals could choose to maintain insurance or not.

“We know definitively that ‘shall’ in this provision does not mean must,” Letter said.

Engelhardt disagreed and said that Congress perhaps should have revised the ACA after the penalty was removed. He also asked Letter why the Senate was not also a party to the defense of the ACA. “They’re sort of the 800-pound gorilla not in the room,” Engelhardt said.

What’s Next?

The judges are not expected to rule for several months and will be addressing several issues, including whether the Democratic states and the House of Representatives have proper standing to defend the law and whether the plaintiffs have the standing to challenge the law.

They also will address whether the individual mandate is still constitutional, and if the mandate is ruled unconstitutional, whether it can be severed from the rest of the ACA, or, on the other hand, whether other provisions of the ACA also must be invalidated, according to the Kaiser Family Foundation.

The court could dismiss the appeal and vacate O’Connor’s judgment, “in which case there wouldn’t be any decision in the case at all,” Timothy S. Jost, professor emeritus at the Washington and Lee University School of Law in Lexington, Virginia, told Medscape Medical News ahead of today’s hearing.

At the hearing, Texas’ Hawkins said it was wrong to say the plaintiffs were trying to strike the law. “There’s an erasure fallacy,” he told the judges. “We’re not asking the court to erase anything.”

Still, O’Connor did say in his ruling that the ACA was unconstitutional. The Trump administration announced in March that it would not defend the law, but said it would continue to enforce the ACA. August E. Flentje, a US Department of Justice lawyer, reiterated that position at the Fifth District hearing today.

But, in a briefing before the hearing, the administration argued that, if ultimately the law is ruled unconstitutional, it should only be struck down in the states seeking to overturn the law. Any ultimate judgment “should not declare a provision unlawful if it doesn’t impact the plaintiff,” Flentje said.

Douglas Letter, for the defendants, was agog. “The DOJ position makes no sense,” he said, noting, for instance, that that would mean that the US Food and Drug Administration — which is required to speed biosimilar drugs to market under the ACA — would approve drugs in California, but not Arizona.

Elrod pressed the point by asking Flentje, “What is the government planning to do?” if the ACA is halted.

“A lot of this has to get sorted out — it’s complicated,” he said.

Despite the outcome of today’s hearings, the case is still ultimately expected to go before the Supreme Court again, according to multiple legal experts.

Advocates: The Stakes Are Astronomical

Shortly after the hearing ended, California Attorney General Xavier Becerra issued a statement predicting disaster for American healthcare if the appeals court agrees that the ACA is unconstitutional. If that happens, “Millions of Americans could be forced to delay, skip, or forego potentially life-saving healthcare,” he said.

“Our state coalition made it clear: on top of risking lives, gutting the law would sow chaos in our entire healthcare system,” Becerra said, vowing to “fight the Trump administration tooth and nail.”

Physicians, consumer and patient advocates, and healthcare groups have voiced their support of the law through friend-of-the-court briefs, starting in June 2018, when the American Medical Association, the American College of Physicians, the American Academy of Family Physicians, the American Academy of Pediatrics, and the American Academy of Child and Adolescent Psychiatry joined together in a brief.

Other organizations have also voiced their support for the ACA through amicus briefs, including: the American Hospital Association, the Federation of American Hospitals, the Catholic Health Association of the United States, the Association of American Medical Colleges, Americas Health Insurance Plans, the Disability Rights Education and Defense Fund, the Blue Cross Blue Shield Association, Families USA, AARP, the Children’s Partnership, 483 federally recognized tribal nations, and 35 cities, counties, and towns.

A coalition led by the American Cancer Society, and including the American Diabetes Association, the American Heart Association, the American Lung Association, the Crohn’s & Colitis Foundation, the Cystic Fibrosis Foundation, the Epilepsy Foundation, the Hemophilia Federation of America, the Leukemia & Lymphoma Society, the March of Dimes, the National Alliance on Mental Illness, the National Coalition for Cancer Survivorship, the National Hemophilia Foundation, the National Multiple Sclerosis Society, and The Kennedy Forum also filed an amicus brief and issued a joint statement ahead of the hearing.

“If allowed to stand, the lower court’s ruling would once again mean people could be charged more or denied coverage based on their health history,” said the statement. “Insurance plans could impose arbitrary annual and lifetime limits on patients’ coverage and could exclude whole categories of care — like prescription drugs — from their plans,” they said, adding that striking the law from the books would jeopardize tax credits used by 8 million Americans to buy health insurance on the individual market.

Millions more could be dropped from Medicaid, the coalition stated. In total, the groups said that some 27 million people could lose health insurance — a figure they said was calculated by the Congressional Budget Office.

The Kaiser Family Foundation estimated that 19 million people could lose insurance. Also at stake: requiring private insurance, Medicare, and Medicaid expansion coverage of preventive services with no cost-sharing, and a phase-out of the Medicare prescription drug “doughnut hole” coverage gap.

“All of these provisions could be overturned if the trial court’s decision is upheld, and it would be enormously complex to disentangle them from the overall health care system,” Kaiser said.

The Urban Institute estimated that if the ACA were overturned, the number of uninsured would increase by 65% — 20 million people; state spending on Medicaid/Children’s Health Insurance Program (CHIP) would fall by $9.6 billion — and that uncompensated care would rise by $50.2 billion, an increase of 82%.

Health Insurance for All: Learning From San Francisco

This last article is an interview with Dr. George Lundberg and the San Francisco healthcare insurance. Hello and welcome. I’m Dr. George Lundberg and this is At Large at Medscape.

You can pay me now or you can pay me later. Perhaps best known as a commercial promoting automobile maintenance, this statement could also apply to healthcare.

Everybody gets sick. If left alone, most acute human maladies fix themselves (automobiles don’t), but people with chronic diseases do better if managed sensibly, including with professional help. Some serious illnesses are fully preventable. The effects of many potentially serious diseases can be ameliorated by early diagnosis and intervention.

Who pays? In whose best interest is it for payment to be assured?

Medical expense insurance in the United States began in Dallas, Texas, in 1929 and Sacramento, California, in 1932. Hospitals needed to be paid; surgeons were particularly motivated early on to assure not only that patients who needed surgery would get it, but also that the surgeons would get paid. Surgical fees often exceeded more typical fees for medical care, so out-of-pocket costs (the normal way doctors and hospitals were paid back then) were more difficult for many patients to afford. Usual medical care did not cost much, but then again, neither did it offer much.

Growing up in small-town, lower Alabama in the 1930s and ’40s, I did not know anyone who had medical expense insurance. Oddly, many people had burial insurance, which was aggressively marketed and sold.

Once medical (health) insurance became common, medical services (and costs) increased and then flourished—an early example of supply-induced demand. Of course, there were benefits for many.

The enactment of Medicare and Medicaid legislation poured gasoline on the already upward-spiraling healthcare cost fire. That is how we arrived at nearly 20% of the US annual gross domestic product going to healthcare.

Our American Medical Association actually warned the country about that risk.[1] The incipient medical-industrial complex developed an insatiable capacity to transfer money by greatly increasing costs, often to gain small, incremental improvements.

Yet, lifesaving medical and surgical interventions do occur, they are often expensive, and someone has to pay for them. Ergo, health insurance. Everyone should have it. Why not?

I live in Silicon Valley. Many of the key innovations that have revolutionized how the world functions day by day have been begun and are headquartered here. Think Google, Apple, Facebook, Airbnb, Uber, Twitter, YouTube, Salesforce, Oracle, Intel, Cisco, Netflix, etc.

So why would it not make sense for San Francisco to pioneer healthcare for all via innovation?

Residents of San Francisco are expected to have health insurance coverage via employment-based insurance, Medicare, the Affordable Care Act (ACA), and Medi-Cal, if eligible, just like all other Americans, with all the pluses and minuses of those programs. But if they don’t, Healthy San Francisco is available regardless of immigration status, employment status, or preexisting medical conditions.

The 2008 Health Care Security Ordinance created the authority that underpins the Healthy San Francisco program. It requires businesses to pay a minimum set amount of money on healthcare benefits for their employees.

Restaurant users learn of this expense of doing business by seeing the note, “In response to employer mandates, including the San Francisco Health Care Security Ordinance, a 4% surcharge will be added to all food and beverage sales.”

Healthy San Francisco is administered by the San Francisco Department of Public Health and delivered via designated Medical Homes. Eligible annual income is set at 500% of the federal poverty limit.

Health insurance is not, a panacea it is not. It is a safety net below the other safety nets. By July 2010, 50,000 people had enrolled, but by 2019, that number declined to about 14,000. The drop probably represents both low unemployment and the success of California’s robust implementation of the ACA via Covered California.

Any other city or county in the United States that would like to provide economic access to basic medical care for its people, without such care being forgone, termed charity, or simply written off as bad debt by providers, could do well by learning from San Francisco’s experience.

Read through the last few paragraphs, especially as we consider elimination, i.e. the uncertain future of the ACA and the possibility of Medicare for All. Also, as I have pointed out in the past few weeks as I have discussed the history of Medicare and Medicaid remember the inability of the administration to accurately predict the true costs. The following addition to the discussion on Medicare and Medicaid will further emphasize the huge costs and expenses of the programs. The next question would be how would the additional up-ward healthcare spiraling costs/expenses be paid for.

Back to our Medicare and Medicaid discussion:

Remember as I just mentioned, that last week I discussed the underestimation of the Medicare program and even more increases which occurred in the Medicaid program. Remember also that because of the wording of Title XIX where the federal government had an open-ended obligation to help underwrite the costs of medical care for the wide range of services to such a large number of recipients, which made it very difficult to accurately predict the ultimate cost.

Then in 1965, the House Ways and Means Committee had estimated that if all of the states were to take advantage of the Medicaid program, including all of the services, that the additional federal costs of medical assistance would amount to $238,000,000. However, in the fiscal year 1967, the total cost of Medicaid payments amounted to $1,944,000,000. Realize that half of these payments were federal funds and realize that the program was operating in only twenty-eight states. Also, interestingly even with the decline in usage and expenditures of other programs by the end of the year 1968 forty-one states had opted into the Medicaid program the total expenditures amounted to $3,783,000,000. Compare this to the total federal outlays for all medical assistance programs in the fiscal year 1965, prior to the introduction of Medicare and Medicaid, amounted to $1,239,000,000.

The goal of the House and Ways Committee when they met in 1971 discussed the need to contain the spiraling costs of Medicare and Medicaid. Members of the individuals testifying were members of the Nixon administration who suggested a whole series of cost-control measures, among them that the new legislation promote a system of capitation payments to health maintenance organizations (HMOs) and that Medicaid introduces cost-sharing while Medicare expands its own cost-sharing policies. Interestingly many of these cost-saving recommendations eventually found their way into the final bill to reform these programs, which became law in October1972.

So, among these changes to the Medicare program was:

  • The inclusion of the totally disabled as eligible for Medicare benefits. Workers of any age and widows and disabled dependent widowers over the age of fifty were eligible to receive Medicare benefits after having received APTD (Aid to Permanently and Totally Disabled) assistance for twenty-four months. This added approximately 1,700,000 beneficiaries to Medicare rolls and was the first instance of any group under the age of sixty-five being made eligible benefits;
  • Beneficiaries of Part B (Supplementary Medical Insurance) who otherwise were ineligible for Part A (Hospital Insurance) by virtue of not qualifying for Social Security coverage could now voluntarily enroll in Part A by paying a monthly premium;
  • Provision was made for capitation payments to HMOs and certain limits were placed on the items that a health care facility could include in calculating its cost.

However, the most significant change in the Medicare program contained in the 1972 amendments was the repeal of a provision contained in the original legislation that made it mandatory that each state expands its Medicaid program each year until it offered comprehensive coverage for all the medically needy by 1977. Remember that when Medicare and Medicaid were first introduced, Congress had hoped to establish a universal hospital and medical insurance scheme for the needy using Medicaid as its foundation but largely as a result of the swelling costs of the program this design was abandoned in1972.

So, let’s see how this week’s set of debates evolve as the candidates make more promises for the answer to the health care problem. How will Kamala Harris pay for her health care system and will private insurance be a thing of the past?

2020 Dems Grapple with How to Pay for ‘Medicare for All’ and the Biden and Sanders Argument, and Yes, More on Medicare

rights328I recently spoke with a friend in the political world of Washington and his comment was that “there is a war here in D.C.” After listening to whatever news reports that you and yes I, listen to I can certainly believe it!! I’m wondering who is really in charge!!

Reporter Elena Schor noticed that the Democratic presidential candidates trying to appeal to progressive voters with a call for “Medicare for All” are wrestling with the thorny question of how to pay for such a dramatic overhaul of the U.S. health care system.

Bernie Sanders, the chief proponent of Medicare for All, says such a remodel could cost up to $40 trillion over a decade. He’s been the most direct in talking about how he’d cover that eye-popping amount, including considering a tax hike on the middle class in exchange for healthcare without co-payments or deductibles — which, he contends, would ultimately cost Americans less than the current healthcare system.

His rivals who also support Medicare for All, however, have offered relatively few firm details so far about how they’d pay for a new government-run, a single-payer system beyond raising taxes on top earners. As the health care debate dominates the early days of the Democratic primary, some experts say candidates won’t be able to duck the question for long.

“It’s not just the rich” who would be hit with new cost burdens to help make single-payer health insurance a reality, said John Holahan, a health policy fellow at the nonpartisan Urban Institute think tank. Democratic candidates campaigning on Medicare for All should offer more specificity about how they would finance it, Holahan added.

Sanders himself has not thrown his weight behind a single strategy to pay for his plan, floating a list of options that include a 7.5% payroll tax on employers and higher taxes on the wealthy. But his list amounts to a more public explanation of how he would pay for Medicare for All than what other Democratic presidential candidates who also back his single-payer legislation have offered.

Kamala Harris, who has repeatedly tried to clarify her position on Medicare for All, vowed this week she wouldn’t raise middle-class taxes to pay for a shift to single-payer coverage. The California senator told CNN that “part of it is going to have to be about Wall Street paying more.”

Her contention prompted criticism that she wasn’t being realistic about what it would take to pay for Medicare for All. Colorado Sen. Michael Bennet, a rival Democratic presidential candidate, said Harris’ claim that Medicare for All would not involve higher taxes on the middle class was “impossible,” though he stopped short of calling her dishonest and said only that candidates “need to be clear” about their policies.

A Harris aide later said she had suggested a tax on Wall Street transactions as only one potential way to finance Medicare for All, and that other options were available. The aide insisted on anonymity in order to speak candidly about the issue.

Another Medicare for All supporter, New York Sen. Kirsten Gillibrand, would ask individuals to pay between 4% and 5% of their income toward the new system and ask their employers to match that level of spending. Gillibrand’s proposal, shared by an aide who requested anonymity to discuss the campaign’s thinking, could supplement the revenue generated by that change with options that hit wealthy individuals and businesses, including a new Wall Street tax.

Gillibrand is a cosponsor of Sanders’ legislation adding a small tax to financial transactions, while Harris is not.

New Jersey Sen. Cory Booker, who also has signed onto Medicare for All legislation but said on the campaign trail that he would pursue incremental steps as well, could seek to raise revenue for the proposal by raising some individual tax rates, changing capital gains taxes or expanding the estate tax, according to an aide who spoke candidly about the issue on condition of anonymity.

The campaign of Massachusetts Sen. Elizabeth Warren, who used last month’s debate to affirm her support for Sanders’ single-payer health care plan, did not respond to a request for more details on potential financing options for Medicare for All.

Meanwhile, Sanders argued during a high-profile Medicare for All speech this week that high private health insurance premiums, deductibles, and copayments, all of which would be eliminated by his proposal, amount to “nothing less than taxes on the middle class.”

Medicare for All opponents are also under pressure to explain how they’d pay for changes to the health insurance market. Former Vice President Joe Biden is advocating for a so-called “public option” that would allow people to decide between a government-financed plan or a private one. He would pay for his $750 billion proposals by repealing tax cuts for the wealthy that President Donald Trump and the GOP cut in 2017, and by raising capital gains taxes on the wealthy.

Inside Biden and Sanders’ Battle Over Health Care—and the Party’s Future

Sahil Kapur noted that Joe Biden and Bernie Sanders are engaged in open warfare over health care that could harden party divisions and play into the hands of President Donald Trump.

In the latest iteration of the battle, Biden’s communications director posted an article on Saturday, entitled “Let’s Get Real About Health Care,” that delved into the potential costs of the proposals favored by the Democratic party’s left flank.

The tension points to a broader power struggle in Washington and on the campaign trail that pits long-dominant moderates like Biden against an insurgent wing led by Sanders and Elizabeth Warren. But a prolonged battle risks entrenching bitterness between the factions that threatens party unity heading into the general election.

Many prominent Democrats fear that backing an end to private health insurance means defeat in the presidential race and the competitive districts that won the party a House majority in 2018. They prefer more modest legislation to expand government-run insurance options.

Biden favors that approach, calling for largely preserving the popular Obamacare while adding a “public option” that would compete with private insurers. Sanders, a Vermont senator and the chief architect of a Medicare for All plan that would cover everybody under a single government plan, wants to replace the 2010 law.

Aimee Allison, who runs She the People, an activist group that seeks to elevate women of color and recently hosted a Democratic presidential forum, said young voters and minorities are eager for change.

“The Democratic Party leadership is more concerned about moderate to conservative Democratic voters, who are a shrinking and less reliable part of the party base than they are about people of color, women of color, younger voters who are inspired by these kinds of ideas,” Allison said.

“That decision led to the loss in 2016,” she said. “There were plenty of black voters who could be inspired to vote and weren’t — and that’s why we lost.”

Climate Change

The split extends far beyond health care. Democrats also differ on how aggressively to tackle climate change and whether to support mass cancellation of student debt.

Dan Pfeiffer, a former senior adviser to President Barack Obama, said the differences among Democrats reflect meaningful policy disagreements rather than just political calculations.

“Bernie Sanders should be applauded for pushing the debate” about how bold to be, Pfeiffer said in an email. “But I do think some of the opposition among the candidates to Sanders’ version is about policy as much as politics.”

The health care debate grew heated earlier this week when Biden, who as vice president helped steer the Affordable Care Act, or Obamacare, through Congress, told voters that the “Medicare For All Act” authored by Sanders “means getting rid of Obamacare — and I’m not for that.” He said the bill would end private insurance and ensure that “Medicare goes away as you know it.”

Fear-Mongering’

Sanders responded by accusing Biden of “fear-mongering” and parroting the “lies” of Trump and the insurance industry. His campaign website posted a “who said it” quiz on health care mocking Biden as being aligned with Senate Majority Leader Mitch McConnell and Trump.

Biden argues that Medicare for All would cancel plans for the 150 million people on private insurance and that he’d give them the option to keep their plan. Sanders says adding a public option to Obamacare would be less effective at covering the 27 million uninsured Americans or cutting costs. While a tax increase would be required to pay for single-payer, eliminating premiums and out-of-pocket costs would offset it, he says.

Biden pressed his argument Thursday, insisting he wasn’t criticizing Sanders but rather conveying what his plan would do.

“Bernie’s completely honest about saying he’s going to raise taxes on the middle class and just straightforward about it,” the former vice president told reporters in Los Angeles.

The Biden campaign went after Sanders’ plan again on Saturday in a Medium.com post, saying that defending Obamacare is a way for Democrats to win in 2020.

“We all understand the appeal of Medicare for All, but before we go down that road we should take a clear-eyed and honest look at what the plan actually says and what it will cost,” wrote Biden communications director Kate Bedingfield. She suggested Biden’s view would prevail “once voters look beyond Twitter and catch-phrases.”

A similar power struggle is unfolding in the House of Representatives, where Speaker Nancy Pelosi and moderate Democrats have clashed with the “Squad” of newly elected progressive women – Representatives Ayanna Pressley, Alexandria Ocasio-Cortez, Ilhan Omar and Rashida Tlaib.

The new lawmakers have used their large social media followings to elevate far-reaching ideas while challenging party leaders to be more tactically aggressive with Trump on issues like immigration and impeachment.

“The Squad — they’re a proxy for the millions of us who want to see a bolder, more progressive set of policies and changes,” Allison said, arguing that limiting the Democratic Party’s vision based on what appears politically possible would prevent new voters from getting engaged and turning out.

Conditional Support

Polling on Medicare for All illustrates the party’s dilemma. Surveys indicate that a majority of Americans favor the idea. But support plummets when people are told the program would eliminate private insurance and rises again when they are told that switching to a government-run plan doesn’t necessarily mean losing their doctors and providers.

Pelosi and other Democratic leaders back Biden’s approach. 2020 rivals Warren, and Senators Kamala Harris, Cory Booker, and Kirsten Gillibrand cosponsor sanders’ single-payer plan. Harris says she prefers single-payer but has also cosponsored legislation for a public option as a route to extending coverage.

Ocasio-Cortez said Americans she talks to “like their health care, they like their doctor,” but that they aren’t “heartbroken” about the prospect of having to transition off an Aetna or Blue Cross Blue Shield plan.

Trump and his allies have sought to make the Squad the face of the Democratic Party, believing that they alienate moderate voters. House GOP campaign chairman Tom Emmer called the four women the “red army of socialists” at a Christian Science Monitor breakfast for reporters.

The four women are among the 114 cosponsors of the Medicare For All Act in the House, but the legislation has stalled out and is unlikely to be brought to a vote, which suggests that the moderate wing is winning the battle in Washington.

Andy Slavitt, a former acting head of the Centers for Medicare and Medicaid Services under Obama, said Democrats unanimously agree on the goal of universal coverage but differ on how best to get there.

“Primaries are about calling out differences in approach. There should be sufficient oxygen to say how would Joe Biden or Michael Bennet do it versus how would Bernie Sanders do it,” he said in an interview.

Slavitt warned that while a debate was healthy, Democrats shouldn’t lose sight of the ultimate goal.

“It’s important that we don’t get so overwhelmed with the distinctions around ‘how’ that we forget there is a massive gulf between what the visions are,” Slavitt said, “between Democrats and the president’s position to repeal the ACA, make coverage more expensive.”

Surprise! Here’s Proof That Medicare for All Is Doomed

Ramesh Ponnuru discovered that there’s a high-profile debate over health care playing out in the presidential race, and a lower-profile one taking place in Congress. Several Democratic presidential candidates are telling us that they are going to provide health care that is free at the point of service to all comers. In little-noticed congressional mark-ups, members of both parties are demonstrating why these promises will not be met.

The legislation under consideration is aimed at so-called surprise medical bills” – charges a patient assumes were covered by insurance but turn out not to have been. My family got one last year: The hospital where my wife delivered our son was in our insurer’s network, but an anesthesiologist outside the network-assisted. The bill had four digits.

Surprise bills seem to be something of a business model for some companies. A 2017 study showed how bills rose when EmCare Inc. took over hospitals’ emergency rooms, with the percentage of visits incurring out-of-network charges jumping “like a light switch was being flipped on.”

Policy experts from across the political spectrum have devised ways to prevent this sticker shock. Benedic Ippolito and David Hyman have a short paper for the American Enterprise Institute (where I am a fellow) that suggests providers of emergency medicine should have to contract with hospitals, reaching agreement on prices and folding them into the total bill, rather than sending separate bills to patients and their insurers. In incidents where the surprise bill is the result of an emergency involving treatment by an out-of-network hospital (or transportation by an out-of-network ambulance), their solution would be to cap payments at 50% above the level that in-network providers get paid on average. In both cases, prices would be determined by negotiation among parties that are informed and not in the middle of a medical emergency.

Senator Lamar Alexander, a Tennessee Republican, has introduced a bill that includes a version of that cap. But provider trade groups favor a different measure introduced by Representative Raul Ruiz, a Democrat from California, which would create a 60-day arbitration process to determine what insurers should pay out-of-network providers, and instructs arbiters to first consider the 80th percentile of list prices for a service in a given market. It is a generous approach that analysts with the USC-Brookings Schaeffer Initiative for Health Policy conclude “would likely result in large revenue increases for emergency and ancillary services, paid for by commercially-insured patients and taxpayers.” It would, therefore, mean higher premiums and federal deficits, while Alexander’s alternative has been estimated to reduce both. Ruiz has 52 co-sponsors who range from liberal Democrats to conservative Republicans.

Turn from this dispute, for a moment, to the Medicare for All proposal (which has some of the same co-sponsors as the Ruiz bill). It envisions sharp cuts in payments to providers – as high as 40%. Those cuts enable advocates to say they will cover the uninsured and provide added coverage to the insured while reducing national health spending.

Is this at all likely? The Alexander bill would try to rein in billing by one subset of providers in cases where the bills are especially unpopular. But the House Energy and Commerce Committee is watering down its surprise-billing legislation, accepting a provider-backed Ruiz amendment to add arbitration. It’s not as generous as Ruiz’s own bill, but its effect would be to keep payments at today’s rates.

The House is following a long line of precedents. For years, bipartisan majorities in Congress voted down planned cuts in provider-payment rates under Medicare; ultimately, they got rid of the planned cuts altogether. Now even modest measures like Alexander’s face determined and effective resistance.

There is, in short, very little appetite for cutting payments to providers. If medical-provider lobbies can force Congress to back off from addressing surprise bills – which are, in the grand scheme of our health-care system, a small kink – what are the odds lawmakers will force a much larger group of providers, including the powerful hospitals lobby, to accept the much larger reductions that Medicare for All would have to entail? Maybe the Democratic presidential hopefuls should be asked that question at the next debate so that we can judge whether Medicare for All is a fantasy or a fraud.

Those of us who are covered by Medicare, we realize the limitations of coverage as well as the discounted reimbursements paid to physicians, hospitals, nursing facilities, etc. Do we think that Medicare for All is going to make it any better for “All”?

Back to Medicare History

By 1972 the costs associated with Medicare had spiraled out of control to such a rate that even the administration and Congress were expressing concern as I pointed before. Then as a consequence, a number of studies were undertaken to examine what were the causes. The conclusions were that this rise was due to hospital service charges that rose much faster than the Consumer Price Index and especially the medical care component of the index as well as physicians’ charges over the first five years of Medicare ending in 1971. The charges rose 39 percent as compared with a 15 percent rise in the five years before the advent of Medicare. If you adjust for the increase in CPI, the Medicare physicians’ charges rose by 11 percent during that first five years of Medicare.

Also as important is that the proportion of total health care expenditures of the elderly that originated in public sources rose far more sharply than had been expected prior to Medicare’s passage. In fact in the fiscal year 1966, the government programs provided 31 percent of the total expended on health care for the elderly and just one year later this proportion had risen to 59 percent. Also, consider that Medicare alone accounted for thirty-five cents of every dollar spent on health services by or for those over the age of 65. There were even more dramatic increases occurred in the Medicaid program during its first few years.

The wording of Title XIX provided that the federal government had an open-ended obligation to help underwrite the costs of medical care for a wide range of services to a large number of possible recipients, depending on state legislation. Therefore, there was no accurate way of predicting the ultimate costs of the program and I will leave this discussion here. Why? Because age we have an older and older population we will have a bigger group in which Medicare will cover. Now if we enlarge the demographic to include “All” Americans the main question is how will we pay for that program?