Paying for Health Care Reform - Physicians for a National Health

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Health Care Reform
Post-Election:
What is “Realistic”?
Leonard Rodberg, PhD
Urban Studies Dept., Queens College/CUNY
and
NY Metro Chapter, Physicians for a National
Health Program
November 18, 2008
[email protected]
Parasitical middleman American Way cartoon
Wall Street Bailout
NYTimes Editorial re
international comparisons
November 18, 2008
Editorial
The Wrong Place to Be Chronically Ill
Chronically ill Americans suffer far worse
care than their counterparts in seven other
industrial nations, according to a new study by
the Commonwealth Fund…the latest telling
evidence that the dysfunctional American
health care system badly needs reform.
Three Possibilities for the
Non-elderly Non-poor
• Private insurance
• Private insurance with a public option
• Public plan/national health program
McCain/Wyden-Bennett:
Individual Responsibility
“You’re On Your Own”
• End employer-based insurance by eliminating the
employers’ tax deduction for health insurance
• Make individuals more cost-conscious consumers
• Use tax credits to help low-income individuals
• Control costs through market competition
No evidence - “Faith-based health policy”
Will Mom & Pop do better than GM and the
Federal Government (FEHBP)?
“Mainstream”Mandate/
Building Blocks Model
•
•
•
•
•
•
Obama/Baucus/Ted Kennedy(?)
Commonwealth/Hacker/HCAN
The problem : Too many uninsured
The solution: Everyone should buy insurance
Employers should contribute or offer insurance
Continued reliance on private insurance, with
the option of a public plan “Keep what you have”
Expansion of Medicaid/SCHIP
No regulation of insurance company premiums
or reimbursement and denial practices
The Mandate/Building Blocks Model
Won’t Work
• It won’t lead to 100% coverage
• Private health insurance will be a continuing
consumers nightmare (copay, deductible, denials)
• Doesn’t address widespread underinsurance
• Increases cost of the system by billions of dollars
• Many payers remain, so the savings from a single
funding source can’t be achieved.
• There is no way to control costs.
It treats the symptom – the uninsured –
while ignoring the disease – private insurance.
Even Its Supporters Recognize the
Superiority of Single Payer
“Compared to a Medicare-for-All approach,
the Building Blocks framework would not
achieve the simplicity, consolidated risk,
administrative overhead, and provider
payment net savings of covering nearly
everyone through Medicare.”
-- Cathy Schoen, Karen Davis and Sara R. Collins, “Building
Blocks For Reform: Achieving Universal Coverage with Private
and Public Group Health Insurance, Health Affairs, May-June 2008
Conyers/Kucinich/et al
Expanded and Improved Medicare for All
“single payer national health insurance”
HR 676
• Automatic enrollment - everyone receives
a card assuring payment for all needed care
• Doctors and hospitals remain independent,
negotiate fees, budgets with public agency
• Public agency processes and pays bills
• Financed through progressive taxes
Where the Private Insurance Dollar
Goes: Nearly 30% for Billing
Allocation of Spending for Hospital and Physician Care
Paid through Private Insurers
Other Insurer Costs
and Profit
11%
Insurer Billing
8%
Hospital Billing
4%
Medical Care
62%
Physician Billing
5%
Medical Care
Administration
10%
Source: James G. Kahn et al, The Cost of Health Insurance Administration in California: Estimates
for Insurers, Physicians, and Hospitals, Health Affairs, 2005, and private communication, 2008
Covering Everyone and Saving
Money through Single Payer
Additional costs
Covering the uninsured and poorly-insured
Elimination of cost-sharing and co-pays
Total Costs
Savings
Reduced hospital administrative costs
Reduced physician office costs
Reduced insurance administrative costs
Bulk purchasing of drugs & equipment
Primary care emphasis & reduce fraud
Total Savings
$B
+6.4% 134
+5.1% 107
+11.5% 241
-1.9% -21
-3.6% -76
-5.3% -111
-2.8% -59
-2.2% -46
-15.8% -313
Source: Health Care for All Californians Plan, Lewin Group, January 2005
Obama on Single Payer 2003
“I happen to be a proponent of a single payer
universal health care program. I see no reason why
the United States of America, the wealthiest country
in the history of the world, cannot provide basic
health insurance to everybody. A single payer health
care plan, a universal health care plan, that’s what I’d
like to see. We may not get there immediately,
because first we have to take back the White House,
the Senate, and the House.”
-- June 30, 2003.
Obama on Single Payer 2007
"A single-payer system--a government-managed
system like Canada's, which disconnects health
insurance from employment--would probably make
sense. But we've got all these legacy systems in
place, and managing the transition, as well as
adjusting the culture to a different system, would be
difficult to pull off. So we may need a system that's
not so disruptive that people feel like suddenly what
they've known for most of their lives is thrown by the
wayside."
-- The New Yorker, May 7, 2007
Obama on Single Payer 2008
"If I were designing a system from scratch, I'd
probably set up a single-payer system. But the
problem is, we're not starting from scratch. Making
that transition in a rapid way would be very difficult.
You’ve got a whole system of institutions that have
been set up. A lot of people work for insurance
companies, a lot of people work for HMOs. So my
attitude is: People don’t have time to wait. They need
relief now. Let’s build up the system we’ve got, let’s
make it more efficient. Maybe over time — as we
make the system more efficient and everybody is
covered — we’ll decide that there are other ways for
us to provide care more effectively.”
-- August 18, 2008
A FALSE POLICY CHOICE
Assertion: “Let’s first cover everybody.
Then we can deal with the system’s
inefficiencies.”
Fact: We will never have enough money to
provide everyone with decent coverage
until we eliminate the principal sources of
waste and inadequate coverage.
Why Health Care Is On the Agenda:
Escalating Cost
Average Annual Premiums for Single and Family
Coverage, 1999-2008
$2,196
$2,471*
2000
Family Coverage
$6,438*
$2,689*
$7,061*
$3,083*
2002
Single Coverage
$5,791
$8,003*
$3,383*
$9,068*
$3,695*
2004
$9,950*
$4,024*
$10,880*
$4,242*
2006
$11,480*
$4,479*
$12,106*
$4,704*
2008
$0
$2,000
$4,000
$6,000
$12,680*
$8,000
$10,000
* Estimate is statistically different from estimate for the previous year shown (p<.05).
Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2008.
$12,000
$14,000
The Growth in Cost Must be Addressed
if Any Plan is to Succeed
Single payer offers real tools to contain costs –
• Budgeting, especially for hospitals
• Investment planning
• Emphasis on primary care and coordination of care
Mandate plans offer only hopes –
• Computerization
• Chronic disease management
• Insurance company competition
There is no data or experience to suggest that
these will cut costs or limit the rise in cost.
The Bottom Line
The Mandate/Building Block model will –
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•
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Make the world’s most costly health system even costlier.
Not improve insurance coverage for the average person.
Not make affordable insurance available.
Not address the problem of underinsurance.
Not contain the continuing growth in cost.
In other words, they won’t work!
Only national health insurance will –
• Cover everyone for comprehensive services.
• Cost no more than we are now spending.
• Provide mechanisms for containing the growth in cost.
Leadership Conference for
Guaranteed Health Care – The
National Single Payer Coalition
• Meeting in Washington, DC Nov. 10-11 at AFL-CIO
Headquarters, but limited involvement of labor
• Sponsors: California Nurses Association, PNHP,
Healthcare NOW, Progressive Democrats of
America, faith groups
• Health care reform = Economic and moral issue
• Media campaign: Need to “Start from Scratch”
• Congressional visits
“the train is moving”
Strategic Questions in this
Post-election Period
• Should “mainstream” health reform be passed quickly,
perhaps providing an economic stimulus?
• Should we oppose early action, urging limited reforms
(SCHIP, Medicare reforms, IT) while the country
engages in a lengthy debate towards real reform?
• Our Rodney Dangerfield problem: How do we get
respect and visibility for the single payer option?
• How do we mobilize latent majority public support?
Will We Get Real Health Care Reform
Before the Premium Takes All our Income?
Today
Source: American Family Physician, November 14, 2005
Physicians for a
National Health Program
For more information:
www.pnhp.org
www.pnhpnymetro.org
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