Monthly Archives: November 2013

A Little Perspective, Please (Part 2)

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Since it’s Thanksgiving weekend, I’ll be brief.

4.2.7

34 “Then the King will say to those on his right, ‘Come, you who are blessed by my Father; take your inheritance, the kingdom prepared for you since the creation of the world. 35 For I was hungry and you gave me something to eat, I was thirsty and you gave me something to drink, I was a stranger and you invited me in, 36 I needed clothes and you clothed me, I was sick and you looked after me, I was in prison and you came to visit me.’

37 “Then the righteous will answer him, ‘Lord, when did we see you hungry and feed you, or thirsty and give you something to drink? 38 When did we see you a stranger and invite you in, or needing clothes and clothe you? 39 When did we see you sick or in prison and go to visit you?’

40 “The King will reply, ‘Truly I tell you, whatever you did for one of the least of these brothers and sisters of mine, you did for me.’

Matthew 25:34-40

Affordable Care Act Timeline: 2012-2014

2012 

  • Established Value-Based Purchasing program (VBP) in Traditional Medicare, offering financial incentives to hospitals to improve the quality of care.
  • Provided incentives for physicians to join together to form “Accountable Care Organizations” to better coordinate patient care and improve the quality, help prevent disease and illness and reduce unnecessary hospital admissions. ACOs will get a financial reward for providing high-quality care at lower cost.
  • Instituted changes to standardize billing and requires health plans to begin adopting and implementing rules for the secure, confidential, electronic exchange of health information. Using electronic health records will reduce paperwork and administrative burdens, cut costs, reduce medical errors and most importantly, improve the quality of care.
  • Required any ongoing or new federal health program to collect and report racial, ethnic and language data to help identify and reduce disparities.

2013 

  • Provided new funding to state Medicaid programs that choose to cover preventive services for patients at little or no cost.
  • Established a national pilot program to encourage hospitals, doctors, and other providers to work together to improve the coordination and quality of patient care.
  • Required states to pay primary care physicians no less than 100% of Medicare payment rates in 2013 and 2014 for primary care services, with the feds picking up the tab.
  • The Health Insurance Marketplace for individuals and small businesses opened October 1, 2013.

January 1, 2014 

  • Prohibits insurance companies from refusing to sell coverage or renew policies because of an individual’s pre-existing conditions
  • Eliminates the ability of insurance companies to charge higher rates due to gender or health status in the individual and small group markets.
  • Phased out annual limits on insurance coverage starting September 23, 2011 and eliminates them entirely January 1, 2014
  • Prohibits insurers from dropping or limiting coverage of individuals participating in clinical trials.
  • Provides tax credits for insurance for people with income between 100% and 400% of the poverty line—about $43,000 or less in 2010—who are not eligible for other affordable coverage.
  • Opens the Health Insurance Marketplace to people whose employers don’t provide benefits.
  • Increases the Small Business Tax Credit up to 50% for “qualified” small businesses and up to 35% for small non-profit organizations.
  • Allows anyone earning less than 133% of the poverty level (about $14,000 for an individual and $29,000 for a family of four) to enroll in Medicaid, with 100% federal funding for three years and then no less than 90% federal funding for subsequent years.
  • The individual mandate becomes effective January 1, 2014.  Everyone who can must purchase insurance or pay a fine.

 

“New Rule: the Republicans have to stop saying that if the Obamacare website doesn’t work that must mean Obamacare itself doesn’t work.  That is like saying the ice cream’s no good because you can’t find a spoon.  And the ice cream is good!  That’s why you can’t find any spoons; they’re all in the dishwasher.”

Bill Maher – November 15, 2013

obamacare_Republican sledgehammer

Conservatives and the media are gleefully focusing on the Health Insurance Marketplace’s rocky rollout while ignoring the rest of the Affordable Care Act’s provisions.  They’re also hypocrites for condemning the $70 million “wasted” on the Marketplace’s computer system, which is only 3% of the $24 BILLION Congressional Republicans wasted by shutting down the government for 16 days.

I edited the Health and Human Services’ overview, Key Features of the Affordable Care Act by Year , for easier reading.  Here’s what we will give up if “Obamacare” is repealed.

2010

  • Insurers can’t deny coverage for children under 19 because of pre-existing conditions
  • Insurers can’t rescind coverage because of a “technical mistake” on an application.
  • Lifetime coverage limits  have been eliminated.
  • Annual coverage limits have been restricted.
  • Provided for an external review mechanism for denied claims.
  • Provided a one-time, tax-free $250 rebate check to seniors in the Medicare D “donut hole.”
  • New health plans have to provide preventive care services without charging a deductible, co-pay or coinsurance,
  • Gave a tax credit for up to 35% of the premium costs for small employers and up to 25% for small non-profits.
  • Allocated more money and staff to combat fraud and waste in Medicare, Medicaid and CHIP.
  • Awarded grants for the state insurance navigators program (October 2010).
  • People with pre-existing conditions who were uninsured for >6 months got access to state or DHHS insurance coverage.
  • Allowed adult children to stay on their parents’ insurance until they turned 26.
  • Created a $5 billion dollar program to continue employee coverage for early retirees.
  • Created incentives to increase the number of primary care physicians, nurses and physician assistants.
  • Allocated $250 million in grants to states plans to require insurance companies in the individual and small business markets to justify rate hikes of >10%.
  • Banned companies with excessive or unjustified rate hikes from participating in the new exchanges in 2014.
  • Provided federal funds for states expanding Medicaid coverage.
  • Increased payments to rural health care providers.
  • Allocated funds to support construction and expansion of community health centers.

2011 

  • Provided 50% discount on brand-name drugs for seniors reaching the “donut hole”
  • Provides additional savings on brand-name and generic drugs through 2020 when the “donut hole” will close.
  • Provided for certain free preventive services for seniors on Medicare.
  • Created Center for Medicare and Medicaid Innovation to test new care delivery models, improve care quality and slow the rate of growth of health care costs.
  • Established the Community Care Transitions Program to coordinate care for high-risk Medicare patients after hospital discharge.
  • Established the Independent Payment Advisory Board to recommend ways to target waste, reduce costs, improve health outcomes, expand care access and extend the life of the Medicare Trust Fund.
  • Allowed states to offer home and community based services to disabled individuals through Medicaid rather than institutional care in nursing homes through the Community First Choice Option.
  • Required insurers for large employers to spend at least 85% and individual and small employer plans to spend at least 80% of all premium dollars on health care services and health care quality improvement and provide rebates if profits or administrative costs are too high.
  • Gradually eliminates overpayment to Medicare Advantage plan insurers; will give bonuses to Medicaid Advantage plans providing “high-quality care.”

Part 2 will look at 2012-present.

What do my taxes buy me?

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Inevitably I find myself arguing with someone who thinks taxes are (a) illegal, (b) theft and (c) a liberal scheme allowing me to give their money to someone else.  For some reason, they don’t think liberals pay taxes, or they think the Treasury Department singles their tax dollars out for welfare recipients just to piss them off. I don’t know of any civilized country that does not tax its citizens and when I suggest finding one, the silence is deafening.

Uncle-Sam-TaxesNow, I actually LIKE paying taxes because, among other things, it means I’m gainfully employed.  I see federal income taxes as the rent I pay to live in a country that allows people to become filthy rich if they so desire.  In other words, I feel an obligation to support my country.

So, when someone asked me, “What do your taxes buy for you?” I came up with this list.

  • Military protection
  • Benefits for those who protected me, some of whom lost limbs, others who lost their minds.
  • People who talk to other countries to avoid wars
  • Cops
  • Firefighters
  • Good roads
  • Libraries
  • Museums
  • National parks to enjoy
  • My primary and secondary education
  • My medical school education, making me a productive member of society
  • My kids’ and other people’s educations so I don’t live in a society of morons
  • Money for research for things that make my life better
  • The opportunity for poor people to get an education without going bankrupt
  • People inspecting my food
  • People making sure my drugs are safe
  • People making sure my flight doesn’t collide with someone else’s
  • Aviation security
  • Health care in my old age
  • Cheaper drugs in my old age
  • Some income security in my old age
  • Some income security if I lose my job
  • Food assistance so other people less fortunate than me don’t starve because I’m not heartless
  • Help if a tornado or hurricane destroys my house/community
  • Watchdogs to chase polluters
  • Someone to cheaply deliver letters
  • Border patrol
  • Customs inspectors
  • A civilized existence

I remain grateful and unapologetic.

Health Care Expenditures: Show Me The Money!

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Any substantive discussion of health care requires a solid foundation.  So here’s a primer on health care expenditures – where the money came from and where it went – prior to the ACA.

Who provides our insurance: in 2007, a little more than half of us (54%) had employer-provided health insurance. Medicare, Medicaid and SCHIP covered another 26%, and 4% of people purchased their own insurance. Sixteen percent of us had no insurance.

Who provides insurance 2007

Source: Kaiser Family Foundation State Health Facts – 2007

But three years later, things had changed significantly.  Less than half of us got insurance from our employers.  Medicaid and Medicare coverage rose to 16% and 13%; private insurance covered 5%.   The percentage of uninsured remained the same.

Who provides insurance 2010

Source: Kaiser Family Foundation – State Health Facts

Government employees get their insurance with taxpayer dollars, not employer revenue.  The American Federation of State, County and Municipal Employees (AFSCME) has 1.6 million members. The American Federation of Government Employees (AFGE) and the National Federation of Federal Employees (NFFE) together have 700,000 members. There are 1.8 million active duty service men and women, many with dependent families, receiving “government-run health care.”   Add veterans and their families covered by TRICARE and the Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA) and we are much closer to “socialized medicine” than any politician will ever admit.

 Who pays for health care: Government is already the single largest health care purchaser; In Medicare, Medicaid, the State Children’s Health Insurance Program (SCHIP) and other public funds paid 40% of health care costs in 2011.  And just to clear up any misconceptions, two thirds of Medicaid funds go for care of the elderly and disabled.  Yep, Medicaid pays for your grandmother’s nursing home, not Medicare, which only covers skilled nursing care.

Private insurance paid for 33% of expenditures; out-of-pocket spending and other private funds accounted for 11% and 7%, respectively.

Who paid for health care 2011

 

 

 

 

Source: California Health Care Foundation

Where our health care dollars go: Hospitals receive 31.4% of our health care dollars; doctors get 19.9% and drugs consume another 10.1%.  Nursing homes receive 5.5% and we spend 2.7% on home health care. “Other Personal Health Care Spending” includes goods and services such as dental, vision and durable medical equipment. “Other Health Spending” includes administrative costs, research, public health services, buildings and equipment.

KFF NHE 2010

Sources: Kaiser Family Foundation and Centers for Medicare & Medicaid Services

Who do we spend it on? The good news is half of us rarely need medical care, accounting for about 3 percent of all health care spending.  The bad news is 5 percent of us are responsible for almost half of expenditures.  The top 1% of people are “super-utilizers,” whose chronic, poorly managed illnesses account for 22% of our annual bill.

Population Consuming Health Care

Source: Agency for Healthcare Research and Quality

One would expect caring for the elderly to be more expensive, but the United States spends far more than other countries.

Health Care costs by age

I’ll try to explain WHY we spend so much money in my next post.

The World’s Most Expensive Health Care

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The United States spends far more money on health care than any other country. In 2010 we spent $8,233 per person, about 2.5 times the Organisation for Economic Cooperation and Development (OECD) average and half again as much as the next most generous country, Norway.   The total cost, $2.6 TRILLION dollars, was 17.6% of our GDP, one-and-a-half times more than those “socialist hellholes” Denmark, France, Canada, the Netherlands and almost double the U.K.

US vs World Health Care

Some people-notably the well-insured and conservative commentators-think this is just fine. “We have the best health care in the world, but government is trying to take that away from us and give it to lazy people.” There will be rationing, death panels, people dying in the streets and your wife will certainly die from breast cancer.

Others, like the people actually paying the bills (namely, Uncle Sam), realize spending all that money doesn’t get us much.  The United States is 51st in life expectancy; our outcomes are about the same as countries with single-payor systems; our pharmaceuticals and hospital procedures cost a lot more. We’ve also rationed health care for decades based on one’s ability to pay, but that’s a separate topic for another rant.

So, somewhere along the line government decided that we should cut our annual health care expenditures. American Medical News published an article I wrote back then warning health care reform wouldn’t be successful because reformers were asking “What kind of health care do you want?” rather than “How are you going to pay for it?”

Spending less money on health care means paying less, and/or doing less. That is simple mathematics. So who is will be the first to accept “less”?

  • Will patients accept less care than they want (as opposed to the care they need)?
  • Will hospitals accept less revenue?
  • Will physicians accept lower salaries?
  • Will insurance companies agree to lower premiums?
  • Will pharmaceutical companies accept less money for their already overpriced drugs?
  • Will manufacturers sell MRI machines and surgical robots for less?

Nothing is likely to happen without tradeoffs; everyone will have to give up something.

If I was contemplating a career in medicine instead of looking at retirement, I’d agree to a lower than expected salary in exchange for free medical school training, decent working conditions and getting the plaintiffs’ attorneys on a very short leash.

  • I wouldn’t need to make a hefty salary if I didn’t graduate with $250,000 in school debt.
  • I would provide much better service if I wasn’t on call every night or every other night.
  • I would be able to do what I thought was right rather than wasting a lot of money covering my ass.

But first we need a national dialog about our health care system.  What do people want?  More importantly, how do they propose paying it?