|
|
|
This week's quote is from The New England Journal of Medicine, February 7, 2008 MARKET-BASED FAILURE A SECOND OPINION ON U.S. HEALTH CARE COSTS, By R Kuttner
Relentless medical inflation has been attributed to many factors -the aging population, the proliferation of new technologies, poor diet and lack of exercise, the tendency of supply (physicians, hospitals, tests, pharmaceuticals, medical devices, and novel treatments) to generate its own demand, excessive litigation and defensive medicine, and tax-favored insurance coverage.
Here is a second opinion. Changing demographics and medical technology pose a cost challenge for every nation's system, but ours is the outlier. The extreme failure of the USA to contain medical costs results primarily from our unique, pervasive commercialization. The dominance of for-profit insurance and pharmaceutical companies, a new wave of investor-owned specialty hospitals, and profit-maximizing behavior even by nonprofit players raise costs and distort resource allocation. Profits, billing, marketing, and the gratuitous costs of private bureaucracies siphon off $400 billion to $500 billion of the $2.1 trillion spent, but the more serious and less appreciated syndrome is the set of perverse incentives produced by commercial dominance of the system.
Markets are said to optimize efficiencies. But despite widespread belief that competition is the key to cost containment, medicine - with its third-party payers and its partly social mission - does not lend itself to market discipline. Why not?
The private insurance system's main techniques for holding down costs are practicing risk selection, limiting the services covered, constraining payments to providers, and shifting costs to patients. But given the system's fragmentation and perverse incentives, much cost-effective care is squeezed out, resources are increasingly allocated in response to profit opportunities rather than medical need, many attainable efficiencies are not achieved, unnecessary medical care is provided for profit, administrative expenses are high, and enormous sums are squandered in efforts to game the system. The result is a blend of overtreatment and undertreatment -and escalating costs. Researchers calculate that between one fifth and one third of medical outlays do nothing to improve health.
A comprehensive national system is far better positioned to match resources with needs -and not through the so-called rationing of care. (It is the U.S. system that has the most de facto rationing- high rates of uninsurance, exclusions for preexisting conditions, excessive deductibles and copayments, and shorter hospital stays and physician visits.) A universal system suffers far less of the feast- or-famine misallocation of resources driven by profit maximization. It also saves huge sums that our system wastes on administration, billing, marketing, profit, executive compensation, and risk selection. When the British National Health Service faced a shortage of primary care doctors, it adjusted pay schedules and added incentives for high-quality care, and the shortage diminished. Our commercialized system seems incapable of producing that result.
This article may still be available CLICK HERE
The prior week's quote was from StatesmanJournal.com, January 29, 2008, "HEALTH PLAN TAKES NEW APPLICANTS" By Thelma Guerrero-Huston
More than 600,000 adult Oregonians lack medical care coverage, according to Oregon Department of Human Services. The agency will now offer new enrollment opportunities for uninsured individuals... by allowing them to put their names on a reservation list for possible health coverage in the Oregon Health Plan's Standard benefit plan.
In March, a computer will begin to draw names randomly from the reservation list. People whose names are drawn will be mailed an application to apply for the OHP Standard plan. Applications will continue to be mailed out each month until 10,000 to 12,000 new individuals are enrolled. This is the first time since 2004 that the Standard plan -- established in 1994 -- is open to new enrollments.
Currently, there are 19,000 people on the OHP Standard plan, which provides low-cost health care coverage to Oregon residents who are age 19 or older, have a low income, and do not qualify for traditional Medicaid coverage. "People without health insurance coverage are sicker and die sooner than those who are able to access health care every day," said Dr. Bruce Goldberg, DHS director. "This is really a tragedy. It's a stain on our community in general."
This article may still be available CLICK HERE
The prior week's quote was from "Drug benefit a boon for seniors, costly for U.S".By Bruce Japsen | Tribune staff reporter January 9, 2008
[Author conflicts of interest for the study published in Annals of Internal Medicine include Merck, Squibb, Astra-Zenaca and GSK among others funding work of the authors, according to investigation by Thomas J. Garvey, TheCenter for Health Care, Policy, Research and Analysis]
After a rocky start, Medicare's drug benefit appears to be delivering a lower prescription tab for seniors, along with a whopping bill for the federal government, new research shows.
The Medicare drug benefit led to a 17 percent decrease in out-of-pocket expenses, or $9 a month, for seniors who enrolled in the new Medicare Part D benefit in 2006, the first full year prescription coverage became available in the federal health insurance program for the elderly and disabled.
The savings amounted to an extra 14 days of medicine for those who signed up, or a 19 percent increase in prescription usage, according to a study released March 5, 2008 in the Annals of Internal Medicine
Unlike studies that have focused largely on those who are covered under the Part D drug benefit, researchers say their work is different because it compared out-of-pocket costs and the number of pills bought by those who were eligible with patients who were not. They also compared the experience of people eligible for Part D who enrolled with those who did not sign up. Part D enrollment "stabilized" after the May 15, 2006, sign-up deadline, and the study looked at the first year's usage to determine the $9 a month prescription savings. Distributed across the entire pool of Medicare beneficiaries, the drug benefit led to a 13.1 percent decrease in out-of-pocket expenses, or $5 a month, and a 5.9 percent increase in prescription use, or four days of pills.
Alexander said some may consider such savings as "insufficient and not worth the money," but there is other research that shows increased drug usage may lead to fewer visits to doctors and hospitals and therefore to cost savings.
Because the study did not look at such health outcomes it fell short, an accompanying "audio editorial" on the Annals' Web site said. That, however, was not so much the fault of the authors but rather of the federal government, which has yet to release Medicare claims data that would help answer questions about the quality of care seniors were receiving with their new benefit and whether drugs were being used appropriately, the editorial says. The study, the editorial noted, looked at prescription usage and not drug usage, which is different because some seniors are known not to take the medicines in their prescriptions.Still,
Critics of the drug benefit have said it has caused runaway growth in Medicare spending. Full implementation of the new benefit contributed to an 18.7 percent increase in total Medicare spending in 2006.
This article may still be available CLICK HERE
The prior week's quote was from The Lewin Group February 15, 2008, "Cost Impact Analysis for the "Health Care for America" Prepared for The Economic Policy Institute
Under the Health Care for America Proposal, employers would be required to provide coverage or pay a payroll tax to have their workers covered under a newly created national health insurance pool called Health Care for America (HCA). Modeled on Medicare, Health Care for America would offer a single Medicare-like fee-for-service option (public HCA plan) and a selection of Health Maintenance Organizations (HMOs) or other private managed care plans (private HCA plans). People who do not have employer-sponsored insurance (ESI) would be covered under HCA, including those now covered under Medicaid and the State’s Children’s Health Insurance Program (SCHIP). The Proposal would provide subsidies for worker HCA premiums for those living below 300 percent of the Federal Poverty Level (FPL), and premium subsidies for non-workers enrolled in HCA who are living below 400 percent of the FPL.
We estimate that there were about 47.8 million uninsured people in the country in 2007. The Health Care for America (HCA) Proposal would reduce the number of uninsured by 46.5 million people (i.e., 97.3 percent of the uninsured), leaving only about 1.3 million people uninsured. Coverage under the proposal would be as follows:
* We estimate that 122.2 million people would be covered under ESI, compared with 157.0 million people under current law;
* About 128.6 million people would be covered through the newly created HCA pool; and
* Enrollment in Medicare and the TRICARE program (i.e., military retirees and dependents) would remain the same as under current law.
The Health Care for America Proposal would cover 46.5 million uninsured people without increasing national spending for health care, largely through lower provider reimbursement, administrative simplification and other features of the proposal. The spending effects of the Proposal include:
* Spending for health care services and prescription drugs nationally would increase by $53.2 billion in 2007 as the uninsured become covered;
* Administrative simplification would reduce administrative costs by about $25.4 billion in 2007;
* There would be additional savings of $27.9 billion due to changes in provider payments, requiring people to have and use a medical home, and government negotiation of prescription drug prices for people covered through HCA.
Federal government health spending would increase under the Health Care for America Proposal by $49.3 billion, after accounting for all offsets. Total program spending under HCA would be $417.7 billion in 2007 including benefits and administration. These costs would be offset by the following:
* Employer payroll taxes for firms that do not provide coverage ($106.8 billion);
* Premiums for individuals covered through HCA ($80.3 billion);
* Federal and state government savings to Medicaid and SCHIP that would be transferred to HCA ($160.1 billion); and
* Other savings and new federal revenues under the Proposal ($21.2 billion).
We estimate that state and local governments would save $21.2 billion as a result of savings to programs that traditionally serve the uninsured (i.e., safety net programs). There would be no immediate net savings to Medicaid and SCHIP for states because they are required to pay the amount saved to HCA to help fund the program (i.e., maintenance of effort for Medicaid SCHIP only). Over time, however, savings achieved by HCA would be shared with the states.
Overall we estimate that private employers spent about $442.7 billion on health care for workers and retirees in 2007 (excludes employee contribution). Under the Health Care for America Proposal, private employer health spending would decrease by $10 billion, reflecting that many firms will find it less costly to discontinue their health plans and pay a six percent payroll tax to enroll their workers in HCA. Changes in private employer spending include:
* Private employers who currently offer coverage would save $65.6 billion by discontinuing their insurance and enroll their workers in HCA by paying the tax;
* Private employers that currently do not offer coverage would spend $55.6 billion more due to the requirement that they either provide coverage or enroll their workers in HCA by paying the payroll tax;
* On average, firms that currently offer coverage would save $809 per worker and those that do not currently offer coverage would spend $1,568 more per worker.
The Health Care for America Proposal requires that individuals obtain coverage and automatically enrolls people who do not have insurance into the public HCA plan. It also provides subsidies to help low- income people pay premiums. Overall, families would save $23.3 billion primarily from lower out-of-pocket payments. However, other financing mechanisms that would be needed to fully fund the proposal (i.e., $49.3 billion) would reduce these savings to families.
The Health Care for America Proposal would control the growth in health spending as enrollment increases, by restricting provider payment increases, negotiating deeper drug discounts, and simplified administration. Thus, national health spending under the HCA Proposal will be lower than under current law. We estimate that under these cost controls, total national health spending over the 2008 through 2017 period would be about $1.04 trillion less than under current law over that same period.
This article may still be available CLICK HERE
The prior week's quote was from Urban Institute January 2008 UNINSURED AND DYING BECAUSE OF IT: Updating the Institute of Medicine Analysis on the Impact of Uninsurance on Mortality By Stan Dorn
In 2002, the Institute of Medicine (IOM) estimated that 18,000 Americans died in 2000 because they were uninsured. Since then, the number of uninsured has grown. Based on the IOM’s methodology and subsequent Census Bureau estimates of insurance coverage, 137,000 people died from 2000 through 2006 because they lacked health insurance, including 22,000 people in 2006.
Much subsequent research has continued to confirm the link between insurance and mortality risk described by IOM. In fact, subsequent studies and analysis suggest that, if anything, the IOM methodology may underestimate the number of deaths that result from a lack of insurance coverage.
More broadly, these estimates should be viewed as reasonable indicators of the general magnitude of excess mortality that results from lack of insurance, not as precise "body counts".
This article may still be available CLICK HERE
The prior week's quote was from The Associated Press-Yahoo Poll based on Interview dates: December 14 - 20, 2007
14. Which comes closest to your view?
34% - The United States should continue the current health insurance system in which most people get their health insurance from private employers, but some people have no insurance
65% - The United States should adopt a universal health insurance program in which everyone is covered under a program like Medicare that is run by the government and financed by taxpayers
2% - Refused / Not Answered
15. Do you consider yourself a supporter of a single-payer health care system, that is a national health plan financed by taxpayers in which all Americans would get their insurance from a single government plan, or not?
54% - Yes
44% - No 44
This article may still be available CLICK HERE
The prior week's quote was from Families USA, December 2007, "Too Great A Burden: America’s Families at Risk"
Health care costs have become a growing burden for America’s families, as premiums and out-of-pocket expenses continue to rise at alarming rates. Families USA commissioned The Lewin Group to analyze data from the U.S. Department of Health and Human Services and the Census Bureau.
* More than four out of five people (82.4 percent) in families spending more than 10 percent of their pre-tax income on health care costs are insured.
* 50.7 million non-elderly Americans with insurance are in families that will spend more than 10 percent of their pre-tax income on health care costs in 2008.
* More than three out of four people (75.8 percent) in families spending more than 25 percent of their pre-tax income on health care costs are insured.
* 13.5 million Americans with insurance are in families that will spend more than 25 percent of their pre-tax income on health care costs in 2008.
This article may still be available CLICK HERE
The prior week's quote was from The Dallas Morning News of December 12, 2007, "How healthy is your medical credit score? System being designed to help hospitals figure out whether you'll pay them", By Jason Roberson
Mortgage lenders aren't the only ones showing more interest in your credit score these days -the health industry is creating its own score to judge your ability to pay.
The score is already raising questions from consumer advocacy groups that fear it will be checked before patients are treated. People with low medical credit scores could receive lower-quality care than those with a healthy medFICO, they argue.
(Steve Mooney, Tenet's senior vice president of patient financial services) says the hospital business has changed over the past 30 years to take on characteristics of the retail industry. With patients expected to pay a larger share and do more comparison shopping, they soon will be able to purchase health care much like an automobile, he said.
Pamela Dixon, executive director of the World Privacy Forum, a consumer advocacy group, isn't impressed. "I don't like it; I don't like it at all. These are people's lives we're talking about. This isn't some car."
This article may still be available CLICK HERE
The prior week's quote was from The Commonwealth Fund's Mathematica Policy Research, of December, 2007, "Leading the Way? Maine's Initial Experience in Expanding Coverage through Dirigo Health Reforms" By Debra J. Lipson, James M. Verdier, and Lynn Quincy
Since enacting comprehensive health care reform in 2003, Maine’s Dirigo Health program has helped expand coverage for low- and moderate-income individuals. By September 2006, about 16,100 individuals were enrolled in two coverage initiatives: DirigoChoice, a subsidized insurance product, and a Medicaid eligibility expansion for low-income parents of dependent children.
While these programs are making health coverage more affordable to low-income individuals, small firms, and sole proprietors, with subsidies targeting those most in need, by late 2006, the initiatives had enrolled less than 10 percent of previously uninsured residents.
This article may still be available CLICK HERE
The prior week's quote was from The Annals of Internal MedICINE, JANUARY 1, 2008, "ACHIEVING A HIGH-PERFORMANCE HEALTH CARE SYSTEM WITH UNIVERSAL ACCESS: WHAT THE UNITED STATES CAN LEARN FROM OTHER COUNTRIES AMERICAN COLLEGE OF PHYSICIANS"
Single-payer financing models, in which one government entity is the sole third-party payer of health care costs, can achieve universal access to health care without barriers based on ability to pay. Single-payer systems generally have the advantage of being more equitable, with lower administrative costs than systems using private health insurance, lower per capita health care expenditures, high levels of consumer and patient satisfaction, and high performance on measures of quality and access.
Pluralistic systems, which involve government entities as well as multiple for-profit or not-for-profit private organizations, can assure universal access, while allowing individuals the freedom to purchase private supplemental coverage, but are more likely to result in inequities in coverage and higher administrative costs (Australia and New Zealand). Pluralistic financing models must provide 1) a legal guarantee that all individuals have access to coverage and 2) sufficient government subsidies and funded coverage for those who cannot afford to purchase coverage through the private sector.
This article may still be available CLICK HERE
|
|
