May
2

The CBO’s Single Payer Report and worker’s comp

The CBO’s 34-page analysis of Single Payer is out, and there are no references to workers’ comp or occupational injuries/illnesses. 

That doesn’t mean there aren’t plenty of ways Single Payer would affect work comp.

Briefly, Single Payer is a very broad term that over-generalizes a bunch of very different approaches to universal health insurance coverage. As defined in the CBO report, in Single Payer programs “people enroll in a health plan operated by the government, and the receipts and expenditures associated with the plan appear in the government’s budget.”

When you recall that work comp accounts for about 1% of total US medical spend, it’s no wonder the CBO report ignores us. But, how Single Payer would affect comp depends on two core issues:

  • whether care for occupational injuries/illnesses is covered by Single Payer, and
  • whether there is a universal fee schedule.

If WC care is included under Single Payer, it is likely work comp would evolve to an indemnity-only system. This currently exists in several other countries, and seems to work pretty well.

If WC medical care is NOT included in Single Payer, the impact would be driven largely by the presence – or absence – of a universal fee schedule. 

Without that universal fee schedule, providers would likely continue to do their revenue maximization thing, although they’d supercharge those efforts. Why? Because reimbursement from all other payers would drop significantly, and providers would look to comp to replace as much of that lost income as possible.

What does this mean for you?

The healthcare system is the elephant, and workers’ comp is the mouse.


Apr
17

Where single payer works – part 1

I’m reading Uwe Reinhardt’s last book, Priced Out. Reinhardt, a universally respected and admired economist with a strong focus on healthcare, died in late 2017. He left a legacy of curiosity and compassion – and practical results.

Reinhardt was instrumental in convincing the government of Taiwan to implement a simple and very effective single payer healthcare system.

Besides an 80% patient approval rating, Taiwan’s system:

  • allows people to see any provider they wish
  • is funded by a payroll tax, with some contributions from other government funds as well as patient copays (which are quite inexpensive)
  • has the lowest administrative expense in the world – 2% of total cost
  • every member has a smart card with their medical records and other key data encrypted. This enables any provider to quickly access key information.
  • costs about a third of the US system.

It is by no means perfect; global budgets and a perceived lack of doctors and nurses are frequently noted as problems.

Yet it has addressed many of the problems we have with our system – medical record transferability, patient costs, paperwork, overall expense, and administrative expense.

What does this mean for you?

The more you know, the better it is.

 

 


Apr
10

On the one hand…

We have a healthplan you’ll absolutely love.  Covers EVERYTHING – glasses, hearing aids, nursing home care, doctor visits, hospital care, surgery, drugs – all FREE!

It’s the about-to-be-announced BernieCare 2.0, aka the “Whole Enchilada Plan”. You can go to  any doctor, hospital, acupuncturist, yoga instructor, therapist, or nursing home your heart – or other internal organ – desires. And did I say, it’s all for FREE!

On the other hand, there’s the SkimpyPlan – and as the Brits say, it’s “on offer” today. Well, it was until a Federal Judge ruled it isn’t.

SkimpyPlans cover, well, not much. Especially if you had one of those pre-existing condition things. You know, migraines, high blood pressure, the “C” word, bad knees, anxiety or pretty much anything else. Oh, and the list of doctors and hospitals is, well, “limited”… and they don’t cover drugs, or pregnancy, or, well, lots of things.

But hey! they’re cheap! Affordable even!

Ok, enough with the sarcasm, here’s where this is headed.

For some unfathomable reason Mitch McConnell and the current Administration think these SkimpyPlans are a great response to the not-hated-any-more ACA.  SkimpyPlans are pretty much the only plan offered by the GOP, and they are awful. They are getting hammered in the press as patients find themselves without coverage for needed care, facing tens of thousands in medical bills, stuck fighting faceless bureaucrats in some distant “insurance company” via voice mail.

Sure many are covered by their employers, even that is getting unaffordable for many AND sticking families with big bills. 

Then there’s the While Enchilada Plan – an end to paperwork, doctor shopping, copays and deductibles, and all FREE.

Do you see where this is going?


Nov
14

Some ill-informed but perhaps well-intentioned people opine that all we need to do to solve the healthcare cost problem is unleash the free market.

Their thinking seems to be that creative approaches and Adam Smith’s “invisible hand” will conquer the cost:quality:access conundrum.

That is wrong for several reasons.

First, no for-profit insurance company wants to “insure” a person with cancer, depression, heart disease, asthma. Nor do they want to keep insuring someone who gets sick.

That would be irrational and stupid, a bad business decision indeed.

Second, there has been ample time and much experimentation with various types of “free market” solutions – yet here we are. Family insurance premiums are close to $20,000 and come with sky-high deductibles, medical trend continues to climb, and big insurers are not jumping into markets.

The free marketers will argue that allowing people to buy skinny healthplans like those pushed by the Trump Administration that don’t cover stuff like drugs or pregnancy is the solution, that this keeps insurance costs down by eliminating coverage that’s “not needed”.

Funny thing about health insurance – no one can predict when they’ll find out they have Hepatitis C, have a motorcycle accident, or have an aneurism.

There’s another problem with the skinny plan idea – insurance requires the many subsidize the few. If healthy people aren’t in the regular insurance pool, costs for sick folks will go up a lot – and inevitably lead to insurance market death spirals where only the wealthiest people can afford insurance.

To be fair, free marketers will assert that this is exactly the problem – a big part of healthcare costs (e.g. maintenance drugs, child health, care for chronic conditions) shouldn’t be insured as they are not a classic “insurable risk”; somewhat unpredictable and random. That’s true. But it begs the question – most Americans can’t afford to pay for needed medical care without support from an insurer or third party.

Which leads us to the real problem – healthcare in this country is very much a profit driven business, and the companies and individuals making gazillions on healthcare are going to fight to the death to keep it that way.

As evidence, see California’s attempt to limit the profits of the dialysis industry. The big dialysis companies spent $111 million dollars to prevent this – which makes perfect sense. However, one needs to understand that almost all dialysis treatment is paid for by you, the taxpayer. And a big chunk of Californians’ tax dollars going to fatten up corporate profits – 3 billion dollars to be precise.

It’s not just dialysis.

Investment firms are buying up dermatology practices, and, according to some reports, encouraging providers to order lots of expensive and potentially unnecessary treatments.

I’m not blaming private equity firms – they are doing what they are supposed to do, generate big returns for their investors. (to be fair, I know several PE firms that are NOT like this – they believe in doing well by doing good.)

And they are very, very good at it.

Finally, Invisible Hand fans will argue that dialysis is the issue – if we get government out of the mix, then the consumer will force down the price.

Ha.

What does this mean for you?

Can you afford dialysis? Is it right for those who can’t afford it to die? Because that’s what the invisible hand would do – push many of us right into a long and painful death.

Note – friend and colleague Tom Lynch must’ve been thinking the same thoughts I have been, as his post is a data-rich, elegant and thoughtful discussion of single payer, and government’s role in healthcare. 

 


Nov
7

And the big winner of the 2018 midterms is…Medicaid.

Three deep red states voted to expand Medicaid, and a fourth voted in a Governor who will comply with her state’s 2017 referendum results and do the  same.

Four states; Montana, Utah, Nebraska, and Idaho, all consistently Republican – had Medicaid expansion on the ballot. Montana’s results are not yet final, but the measure passed in the other three states. [Montana had temporarily expanded Medicaid about two years ago; the vote was to decide whether or not to make expansion permanent.]

53 percent of Nebraskans voting checked the “expansion” box, despite strident requests from Gov Pete Ricketts (R) to vote NO. Utah passed the referendum by about the same margin, while Idahoans were even more supportive, with 62 percent voting in favor.

Departing Maine Gov Paul LePage refused to expand Medicaid even after more than 60 percent of voters demanded just that in a referendum last year. Gov. Elect Janet Mills has promised to begin expansion on day one of her term in office.

Montana might be a different story. Early returns indicate a $20 million anti-Medicaid campaign backed by the tobacco industry may have been effective. The measure would have increased the price on a host of tobacco products by $2 to cover the state’s costs.

Notably, hospital groups in each state were strong supporters of each initiative, as they have been in pretty much every state since the ACA was passed. I’d expect to see more states expanding Medicaid in the future in a replay of the original Medicaid roll-out from the mid-nineteen sixties.

With the rollout, rural hospitals and those with higher proportions of poorer patients are getting a financial lifeline, one that they sorely need.

What does this mean for you?

Medicaid expansion is inevitable, and that is good news for hospitals and decreases pressure to cost-shift to other payers.


Nov
5

What this election means to you.

This election is about your health and your family’s, because:

“Virtually every American has someone with an existing health condition in their family at any given time” 

Dan Mendelson, CEO, Avalere

(Note to readers – this isn’t a “liberal” or Democratic post, it is a factual description of reality. If you disagree, please provide citations to support assertions)

Today, you are protected because under current law (the ACA, aka “Obamacare”)  insurance companies can’t refuse to provide coverage or charge you more if you have a medical condition.  

Those protections will go away if Republicans have their way. 

According to Avalere,

Over 50% of Americans enrolled in coverage outside of the major public programs could face medical underwriting or be denied access to coverage or care without the protections for people with pre-existing conditions contained in the ACA.

Here’s why.

  1. Last year Republicans came within one vote of repealing the ACA – with NO replacement plan in place.
  2. Senate leader Mitch McConnell has said he will try to repeal ACA next year.
  3. House Republicans voted over 54 times to repeal ACA – with NO replacement plan in place.
  4. The “short-term” and “association” healthplans proposed by Republicans let insurance companies charge you anything they want if you or a family member have a pre-existing condition.
  5. These short-term and association healthplans can pick and choose what healthcare services they cover – they don’t have to cover drugs, pregnancy, or emergency room care, or anything else they bury in the fine print.
  6. Republicans are backing a lawsuit that would overturn the ACA in its entirety – and many of the Republicans behind the suit are running for Congress.

If you or someone in your family has had:

  • heart disease, high cholesterol, or high blood pressure
  • anxiety or depression or any other mental health condition
  • obesity
  • diabetes
  • cancer
  • or is pregnant,

your healthcare is at risk.

I have no problem whatsoever with principled Republicans – or anyone else – wanting to overturn the ACA. I have a big problem with anyone who’s lying about what they are doing.

 

Fact is the GOP has tried over 50 times to let insurance companies refuse to cover your pre-existing conditions, they are pushing a suit that would do the same thing, their bills in Congress will let insurance companies charge you anything they want, yet they are claiming they will protect you.

That’s just a lie.

What does this mean for you?

Do you want insurance to cover your pre-existing medical conditions? 


Oct
24

This election is about your pre-existing medical condition

Will you be able to afford health insurance, and will that insurance cover your pre-existing medical conditions? For most, that’s the biggest issue in the upcoming election.

Congressional Republicans are planning to pass legislation that allows insurers to:

a) stop paying for your pre-ex conditions; and/or

b) charge you anything they want for your health insurance – which does the same thing

Ignore their claims that they will protect you, because:

What they do have is bait-and-switch.

Republican candidates are pushing legislation that would “force insurers to cover all pre-existing conditions” – but they could charge you anything they want for that insurance. 

If you just won the $1.4 billion lotto, you’re all set. If not, you’re screwed.

What does this mean for you?

If you or a family member have a pre-existing condition, this election is about you.

If you aren’t sure, here’s a list.

And if you think you can hide your condition, you can’t. 


Oct
15

It’s complicated.

Let’s have a reasoned and fact-based discussion of why I believe the trade war is bad for your business and your job.

At its most basic level, the issue is this – there are few simple answers to big problems. Sure, there are soundbites and memes that may make you feel good… but like that second helping of dessert, it tastes great but leaves you feeling bloated and unhappy.

For example – “Trade wars are good and easy to win.”

If you want to get a country to change it’s industrial policy or actions, a trade war is certainly one option.

Some think the tariffs on China were an appropriate way to get its attention. And no doubt, the import duties on steel and aluminum and manufactured goods got noticed.

But tariffs are a two way street; the Administration’s actions resulted in China imposing retaliatory taxes on US exports of coal, farm goods, motorcycles, asphalt, Vaseline, cars, meat, airplanes and a bunch of other stuff.

It’s not just China – The tariffs on Canadian newsprint were crushing US newspapers, many of which have been barely staying afloat. The tariffs were finally overturned after hundreds of jobs were lost.

Farmers aren’t as fortunate; there are hundreds of millions of bushels of soybeans piling up – with no buyers in sight. Farmers looking to store this grain can’t afford new silos, as the price of steel has gone up 25%.

And jobs are at stake.  From Forbes:

“The tariffs, quotas and retaliation would increase the annual level of U.S. steel employment and non-ferrous metals (primarily aluminum) employment by 26,280 jobs over the first one-three years, but reduce net employment by 432,747 jobs throughout the rest of the economy, for a total net loss of 400,445 jobs.” [emphasis added] The analysis found, “16 jobs would be lost for every steel/aluminum job gained.”

It’s not just employment; tariffs don’t operate in a vacuum, but are one tool governments have to influence other countries. In fact, there are real national security issues in play here.

One is North Korea; China has more influence on North Korea than every other country combined, so when we anger the Chinese, they get a lot less interested in enforcing arms and energy embargoes on the rogue state of North Korea.

Then there’s China’s illegal building of naval bases in the South China Sea, which is a shipping bottleneck; over a quarter of the world’s shipping transits the Sea. It is also home to huge reserves of carbon-based energy deposits. The pace of construction has greatly accelerated of late and the number of troubling incidents in the area has increased – a Chinese naval vessel almost collided with a US destroyer a few weeks ago.

Okay, you say, we’ll get this resolved and all will go back to the way it was, farmers and pork producers and Boeing and coal miners will be fine.

Not so fast.

In reality, China – and other countries affected by our tariffs – have already shifted their purchasing to other countries. Brazil and Argentina are huge grain and meat producing countries, and they are benefiting greatly from the trade war.

US farmers are getting hammeredUS wheat exports globally have plummeted by 21 per cent in just the first half of 2018. This means fewer dollars for farm equipment, fencing, fuel, fertilizer.

And farmers are the canary in the coal mine; this trade war is going to have lasting and serious repercussions for our economy and each one of us; the longer it goes on, the worse it will get.

What does this mean for you?

When you’re stuck in a hole, the first thing to do is stop digging. 

Why this affects you – a recession hurts all of us – lowering employment, increasing healthcare costs, increasing work comp claims.

But long-term losses of markets causes long-term damage to entire economic sectors. That’s the real issue here.

 


Sep
10

Hypocrisy hits new heights.

The same folks who want to cut $537 billion from Medicare are now claiming only they can “protect” Medicare.

Out on the campaign trail, President Trump and Gov Rick Scott (R FL) are claiming “Medicare for All” would somehow harm Medicare, and seniors need to vote for them to preserve Medicare as it is.

In an obvious attempt to scare seniors, Trump et al are asserting that expanding Medicare – the most-liked health coverage in the nation – will somehow result in seniors losing Medicare benefits. They support this assertion with no logic, no coherent argument, no evidence or data, yet there it is.

This from the same folks who, just a couple months ago, wanted to cut seniors’ Medicare benefits. What’s changed?

Elections are coming, that’s what’s changed.

According to Forbes, the GOP is looking for:

$900 million in cuts to rein in Medicare prescription abuses. Another $5 billion is cuts are specified to address high drug prices, while $286 billion in funding will be pared to reduce excessive hospital payments.

Now, there’s an argument to be made that Medicare is not financially sustainable – especially given the huge tax cuts passed by the GOP.  And yes, we need to figure out how we can keep Medicare viable given the drop in federal tax revenue due to the tax cut.

But to turn around and claim that expanding Medicare for All is somehow damaging to a program you’d like to cut by a half-trillion dollars is, well, the height of hypocrisy.

What does this mean for you?

Medicare for All isn’t a threat to Medicare. 


Sep
5

Making “Medicaid for All” work

The US healthcare “system” is headed towards a cliff, and when it hits the edge, Medicaid may well be the replacement.

Briefly:

  • Managed Medicaid plans would be offered in every state
  • people would sign up for the plan they want, with the option of enrolling in regular fee for service Medicaid
  • funding would be from payroll taxes, individual service-based fees, and federal funds
  • provider reimbursement would be pegged to Medicare for ALL payers, eliminating payer-shopping by providers and increasing Medicaid FFS reimbursement

The details…

There are two ways this would work – Medicaid for All (MFA) becomes the way all of us get coverage, or Medicare remains in place for elderly folks and Medicaid covers everyone else.

It’s entirely possible employers continue providing basic healthcare coverage, but really, do they want to? It’s expensive and a pain in the neck. Instead, employers will be able to offer supplemental insurance (similar to what happens in Canada, the UK, and other countries) as an employment benefit.

Today, Medicaid comes in two general flavors – “classic” and Managed Medicaid.

Classic is fee-for-service Medicaid, where members can go to any provider that accepts Medicaid. Providers are paid on a fee for service basis, at rates that vary greatly between states (states set reimbursement).

Managed Medicaid is an option in almost every state. The states contract with healthplans to provide integrated Medicare and Medicaid in what are called “dual eligible” programs (members are eligible for both Medicare and Medicaid).

The Managed Medicaid (MM) plans are paid on a capitated basis – that is, a flat fee per member. That fee is based on the health status and health risks of the members; the sicker the member is, the higher the capitation amount.

This arrangement incentivizes MM plans to figure out the optimal ways to keep members healthy and keep costs down – keep them out of the ER, avoid inpatient hospital stays, and encourage healthy behaviors. If costs come in under budget, the plans make money (usually a couple percent at most). If not, the plan loses money – not the taxpayer. (MFA will be based on Managed Medicaid)

(a detailed explanation is here.)

Today, states with these plans in place enroll members in different ways. Some randomly assign members to plans, others allow more assertive competition among the plans for members. I’d expect this to continue under Medicaid for All; existing enrollment processes would be expanded, systems upgraded, and communications refined to address the broader market. Every fall, MM plans would compete for members, enrolling them before the end of the calendar year.

Individual contributions to premiums would be income-based (as under ACA today); there could be low copays for certain services but paperwork for members would be almost non-existent. (All Medicaid members today have ID cards that enable electronic record sharing, billing, and claims submission.)

Funding would be a combination of service-based fees (copays and co-insurance), payroll taxes, federal funds, and perhaps general state funds.

Remember, as employers would no longer have to deliver health insurance, those dollars could be spent on higher wages, to offset payroll taxes, or for other purposes. Similarly, individual payments for premiums, high deductibles and the like would be eliminated, altho some of those “savings” would go to higher payroll taxes to cover Medicaid for All.

Provider reimbursement would be up to the MM plans negotiating with providers – who would remain independent (unless they are employed in a health system that is also a MM plan provider). However, FFS Medicaid reimbursement would be increased to mirror Medicare’s rates.

Why this is the future

US healthcare is not sustainable. Period.

Family health insurance premiums are nearing $20,000, the number one cause for bankruptcy is medical debt, Medicare and Medicaid are the largest chunks of the federal budget, and industrial competitiveness is hampered by healthcare costs which are double the average costs in other countries.

And, 74% of Americans are worried about losing their insurance.

So, we can either keep driving off the cliff, or take an alternate route. One that will be very rocky, cause a lot of headaches and heartache, disrupt businesses and families and providers, but one that sooner or later, we’ll have to choose.

What does this mean for you?

It’s not a matter of if, but when.

Note – happy to engage in fact-based, citation-supported conversation. “I heard this” and “everyone knows” arguments are not helpful.