Massachusetts’ health reform plan is going to cost far more than projected – $1.35 billion annually within three years. That’s compared to the original estimate of $725 million.
That’s bad, right?
Actually, it’s not all bad.
Projected costs are increasing primarily because enrollment is much higher than anticipated – and ultimately will likely be more than two times projections. It appears officials significantly underestimated the number of residents without health insurance, and those without coverage have signed up faster than expected.
I’ll admit to being one of the naysayers – my take was the per-employee penalty of $295 was not going to be enough to encourage employers to offer coverage – and I’m happy to be wrong. The other related criticism (but not from me) had to do with ‘crowd out’ – employers might drop coverage if their workers could obtain it from the Connector (Mass’ name for the health plan buying entity). That doesn’t appear to be a problem either, at least not yet. A relatively small percentage of employers are going to drop coverage this year – a percentage not materially different from employers in other states.
So far, it looks like the reform plan is succeeding in getting more folks covered. But, the program has not met its goals for cost reduction or reduced payouts for indigent care. While the strong enrollment numbers are great, the tough part now starts – and controlling costs is going to be a lot tougher than enrolling members.

I’ve been meaning to get to this for weeks now – while I (and others) have reviewed and compared the two plans and parts thereof, I’ve yet to see a brief but (reasonably) comprehensive comparison.
First, what these plans are not. They are not ‘socialized medicine”, single payer, or any version thereof. Both Obama and Clinton rely on private insurers to provide coverage, and make no changes to the health care provider community – they do not become government employees.
We’ll start with what others have said is the only real difference between the two – mandated universal coverage – Clinton’s plan requires a mandate; Obama’s doesn’t. I disagree- there are several other key differences, issues that we’ll highlight here and address in detail in future posts. The issues may seem picayune but the devil is in the details, and details in health care add up to half a trillion bucks or so.
From reading Obama’s campaign literature or speeches, it seems like the Senator is in favor of mandated universal coverage. Unfortunately, Obama’s rhetoric is inconsistent with his plan, leading me to suspect he wants to have his cake, eat it too, and not get fat. Obama does have a mandate, but it is specific to children – he requires all kids to have coverage, but his plan does not require working-age people obtain coverage.
(disclaimer – this is not all-encompassing, but rather meant to hit the high and medium points without getting down to the molecular level)

Continue reading How the Clinton and Obama health plans differ

Randall Hoven’s piece in “American Thinker” is admirable; Hoven is outraged that we don’t get what we pay for, and thinks we can do better.
He’s also speaking as one with a daughter that needed a heart transplant; this experience evidently informed his thinking, as Hoven appears to understand the need for insurance.
His views are remarkably consistent with other Republicans, even some of those who consider themselves staunch conservatives.

Increasing tax breaks for health insurance will not materially increase the number of folks with insurance. Yes, there are several studies that purport the Bush plan will result in more folks buying coverage, but there are a number of studies that show it would result in a very small increase, or actually decrease the number of folks with insurance.
What is puzzling is the schizophrenia embodied in conservatives’ view on health insurance and taxation thereof. Bush, an avowed conservative, touts tax breaks as the way to get more people to buy coverage, an idea also central to the platform planks of Mssrs. McCain, Giuliani, and Romney (Huckabee’s ‘fair tax’ is, well, rather different).
Doesn’t this amount to a government subsidy of health insurance, one that will distort consumer behavior by reducing the cost of coverage, and therefore of health care? Bush et al try to address this via high deductibles, but isn’t that fixing a problem caused by their own tax policy? If conservatives have so much confidence in the consumer, why do they need to offer them a tax break to buy something that logically, it is in the consumer’s best interests to purchase?
Conservative policy types have suggested chopping the proverbial baby in two, by limiting tax breaks to those plans that provide a minimum level of benefits. The idea is to encourage coverage without subsidizing plans with excessive levels of benefits; those “Cadillac” plans. What parts of the plan make it a “cadillac”?
– Hospital coverage?
– Physician visit coverage?
– Drug coverage?
– Diagnostic test and imaging coverage?
– Behavioral and mental health coverage?
– Physical therapy?
Where’s the bling? Where’s the fine Corinthian leather, the Bose 29 speaker stereo, the gold-embossed hood ornament?
Where’s the ‘excessive’ insurance? If there is any, it is small potatoes.
I applaud the folks who are trying to square their philosophies with the realities of politics, economics, and health care. Their ability to tie themselves in knots in an effort to remain true to their ideology while fixing a problem is painful to watch.
I’m just now sure how that solution is ‘conservative’.

Single-payer advocates have won another skirmish in the battle over health care reform, while those in favor of reform based on the existing insurance marketplace (that would include your author) are once again trying to explain why big insurance companies screw up so badly so often.
An audit by the California Insurance Department and Department of Managed Health Care found that Pacificare routinely mishandled claims and customer inquiries, with ‘routinely’ defined as about one-third of the time.
For those (including me) forever excoriating health systems and hospitals for their outrageous error rates, the debacle at Pacificare, the recently-acquired division of United Healthcare (one of my past employers) make the delivery sector look like a paragon of performance. I’m not overly surprised, as mergers involve systems conversions, the amalgamation of provider networks and contracts, and the shifting of work around to different call centers and processing locations. Duplicate staff positions are identified and people laid off, and when they walk out the door so does the expertise and understanding that enabled the operation to run smoothly.
Some will argue that this is a temporary hiccup, that any merger of this type and size will inevitably result in problems. All true, as is the point that they could not be screwing up at a worse time – during an election year wherein the future of their business will be determined.
So far, the private sector is not making much of a case.
Thanks to California Healthline for the tip.

What does the Florida GOP primary say about voters’ views on health care?
At first blush, they aren’t concerned.

Continue reading Florida GOP results – implications for health care reform

My post on the GOP Presidential candidates and universal coverage elicited more than a few responses, most of which were cordial and helpful. Several took exception to the poll I cited (conducted by GOP pollster Tony Fabrizio’s firm) noting (accurately) that it was over six months old.
Fortunately, a comprehensive analysis of polling data re health care was just published. There’s a lot here, but the net is this – lots of Republicans support universal coverage. For example, in a NYTimes poll from late 2006, 44% of the Republicans polled favored “requiring…everyone have health insurance, with government helping to pay for insurance for those who cannot afford it.”
That is a lower percentage than the June poll; the difference could be in the wording of the questions or perhaps the population’s concern had grown over the eight months.
UPDATE – Another, very recent poll found similar support among Republicans for universal coverage – fully 65% would support reform that helped reduce the number of uninsured (23% favoring a plan to cover everyone, even if it would result in substantial additional spending and the remainder looking for a less ambitious plan that would likely only cover some of the currently uninsured)
The same poll found a slight majority of Republicans (53%) did not favor an individual mandate (a topic that is related to but not the same as universal coverage).
Comparing poll results can be touchy as the questions are usually different; Fabrizio’s June poll found 51% of Republicans agreed with the statement “Universal health care coverage SHOULD BE a guaranteed right of every American” (original emphasis).
And yet another poll, this one by the Commonwealth Fund, found a similar result – 52% of Republicans were strongly or somewhat in favor of requiring individuals to have health insurance coverage, with government help for those with limited incomes. (for independents the corresponding figure was 68%)
The Fabrizio poll is remarkably detailed and provides a breakdown of the perspectives of specific groups of Republicans. There are three segments that are most favorably disposed to universal coverage.
“Moralists” are the largest single group, accounting for 24% of all Republicans. Among the ‘moralists’, 48% were in favor of universal coverage. This segment is predominantly Born Again or Evangelical, poorer than the average, and disproportionately female.
13% of those polled were identified as “government knows best” Republicans (isn’t that an oxymoron?). The GKB folks were typically female and McCain fans, and fully 93% were supportive of universal coverage.
The third group, ‘Heartland’ Republicans (also 13%), were also McCain backers. Predominantly midwesterners, 72% supported universal coverage.
Digging ever deeper into the numbers, Republicans were more concerned with the cost of care (42%) than with covering everyone (19%). (Listening to Sen. Obama on health care makes me wonder if he carefully studied Fabrizio’s poll before coming out with the PR spin for his health reform plan; although Obama’s reform initiative is virtually identical to Sen. Clinton’s (except for mandated universal coverage), he has been consistently emphasizing cost control.)
While there are clear differences between the two camps, they do agree on one major issue: fewer than one in five voters, Republican or Democrat, believe it is the employer’s responsibility to ensure that people have health care.

Giuliani, McCain, Romney, Huckabee, and Thompson are all opposed to health care reform measures that incorporate universal coverage. Tax breaks, high deductible plans, consumerism – all are fine, but no GOP presidential candidates support universal coverage.
Why not?
A majority of registered Republicans favor universal coverage, and given the tightness of the race, one would think at least one of the candidates would jump on the chance to separate himself from the rest.
The failure to grasp the universal coverage plank looks to be a missed opportunity – if a majority of potential primary voters back an idea that is noticeably absent from any candidate’s platform, voter support for universal coverage may well increase if a candidate actually talks about it (and for that candidate as well). Again, why aren’t they?
I understand why social conservatives bristle at the idea, but economic and religious conservatives would likely favor reform measures that include universal coverage

Continue reading Why don’t the GOP candidates want universal coverage?

My post on HSAs earlier this week struck a few nerves, with several coming to the defense of HSA. Some raised good points; others appeared to misunderstand the point of the original post.
Let’s start with an easy one. A reader opined that 20-25% of the uninsured make over $75,000. Not so. The Employee Benefit Research Institute reported that 14% of the uninsured had family incomes over $75k (2006 data).
One noted that they make “health care more affordable for the majority of consumers”; I think the commenter is conflating health insurance with health care. HSA plans may make insurance more affordable, but health care costs are not any cheaper under HSA plans. In fact, HSA plans’ higher out-of-pocket costs may make health care costs less affordable.
Another said “hypocracy (sic) exists with political scientists disbelieving that individuals cannot make wise healthcare buying decisions”; I’m not a political scientist so I can’t speak to that. I do know that the lack of actionable information re physician quality, outcomes, and costs is well-documented and real. And without information individuals can’t make wise decisions.
Yet another claimed “Anyone who pays taxes will make out being in an HSA”. I agree – what the commenter missed was the topic sentence of the original post “The article notes that the “biggest beneficiaries” of health savings accounts “are proving to be well-to-do investors looking for another way to fund their retirement savings.” Everyone benefits, but the biggest beneficiaries are well to do investors. If you disagree, write to the WSJ.
A critic claimed that studies indicate “individual policies that are HSA-qualified cost 20 percent less than non-HSA-qualified plans…They also show about 25 to 30 percent of individuals purchasing HSA-qualified policies were previously uninsured.”
Agreed, at least partially – HSA plans are cheaper than non-HSA plans only if the deductible differential is taken into account. The price difference is because HSAs have more cost-sharing. As to the claim that 25-30% of HSAs were bought by those previously uninsured, I have not found a solid study that backs up that contention. Jonathan Gruber of M.I.T. published a study indicating the number of uninsured may well increase due to the advent of HSAs.
Here’s what Gruber said:
“…currently employers have a large tax advantage in offering insurance, since wages are taxed but employer-provided insurance premiums are not, and this is part of the reason that so many employers provide insurance to their employees. This policy will remove that tax advantage for HSAs, causing some employers (typically small employers) to stop offering insurance coverage to their employees. Only about half of those employees dropped from employer-provided insurance enroll elsewhere, 4 million in non-group insurance (predominantly tax-subsidized HSAs) and 0.5 million in Medicaid. The remaining 4.4 million become uninsured.”
We do know that the percentage of employers in California offering health insurance has declined over the last few years, although we don’t have current data I’m pretty confident this trend has not reversed itself recently.
Comments are always appreciated, but comments that include citations are really much better. If you are going to cite facts or state positions based on a particular “fact”, please cite a source.

Today’s anointed front-runner in the GOP is John McCain (a position he may hold longer than Sen. Obama did on the other side of the aisle). Here’s where the senator stands on health care.
Analysis
The quick take is this: McCain’s plan has some strong points and resonates with Republicans, but most GOP voters aren’t thinking about health care.
While most other candidates are talking about covering the uninsured, McCain is focused on cost. More specifically, the cost of chronic conditions such as diabetes, asthma and CAD which account for 75% of the US’ entire $2 trillion health care bill. McCain is not just pointing out the obvious, he also plans to attack these costs by altering reimbursement – paying providers for maintaining health rather than reimbursing for specific procedures.
Here’s how McCain put it:
“We should pay a single bill for high-quality health care, not an endless series of bills for presurgical tests and visits, hospitalization and surgery, and follow-up tests, drugs and office visits,”
That makes a ton of sense. It is also entirely consistent with the views of George Halvorson, CEO of Kaiser Permanente, outlined in his book Health Care Reform Now (which came out just a few days before McCain’s first major speech on health care). If McCain is reading Halvorson, that’s a good thing.
So far, so good. So far.

Continue reading McCain’s health care plan