We at NCPA wish you a safe and pleasant Memorial Day. While you are celebrating the start of summer, please remember those for whom the day is commemorated.
We”ll be back on Tuesday.
Here is a list of the U.S.-based businesses, professional & trade associations, charities, individuals, and academic institutions in the healthcare sector who have given at least $100,001 to the Clinton Foundation, either as donations or speaking fees, compiled from the foundation’s website:
$1,000,001 to $5,000,000
Blue Cross and Blue Shield of North Carolina
Tenet Healthcare Corporation
The Wall Street Journal has reviewed health plans’ rate filings for 2016 in Obamacare exchanges:
In New Mexico, market leader Health Care Service Corp. is asking for an average jump of 51.6% in premiums for 2016. The biggest insurer in Tennessee, BlueCross BlueShield of Tennessee, has requested an average 36.3% increase. In Maryland, market leader CareFirst BlueCross BlueShield wants to raise rates 30.4% across its products. Moda Health, the largest insurer on the Oregon health exchange, seeks an average boost of around 25%.
All of them cite high medical costs incurred by people newly enrolled under the Affordable Care Act. (Louise Radnofsky, “Health Insurers Seek Healthy Rate Boosts,” May 21, 2015)
The National Academy of Social Insurance (NASI) recently published a consensus report on provider consolidation. Basically, we have a growing problem in that hospitals are buying each other up and also physician practices, which leads to reduced competition and higher prices.
The report was promoted with an op-ed in The Hill by the esteemed Robert A. Berenson (Urban Institute) and G. William Hoagland (Bipartisan Policy Center):
The use of market power—or the ability to raise and keep prices higher than would prevail in a competitive market – is the key reason the United States spends so much more on healthcare than other countries.
For policymakers, tackling the lack of competition is like climbing a mountain. Even the initial steps — creating more competition – may be difficult, but they must be explored before more regulatory action further down the path is considered.
These are remarkable statements; and difficult to accept uncritically.
(A version of this Health Alert was published by Forbes.)
Senator Bill Cassidy (R-LA) has introduced the Patient Freedom Act, in anticipation of the Supreme Court deciding for the plaintiffs in King v. Burwell, the lawsuit that seeks to force the administration to obey the law by not paying tax credits to health plans operating in states using a federal health insurance exchange (i.e. healthcare.gov).
Victory for the plaintiffs this summer would cause significant disruption in health insurance in the 34 to 37 states without their own exchanges because premiums for up to nine million people would increase significantly. Many would choose to drop coverage if and when they have to face paying full premium for their policies.
Congress must have an alternative to Obamacare ready because President Obama will immediately propose an amendment to change the law to accord with how he is executing it. That is: Let tax credits continue to flow through healthcare.gov and just forget the money paid since January 2014 was illegal. It would be a very simple amendment – just a few sentences. The risk of Congress panicking and simply voting for that amendment, and finally surrendering to Obamacare, is unacceptable.
Americans have had their health coverage upended not only by the Affordable Care Act, but also by the allegedly illegal execution of the law by the administration. Congress has a duty to respond to a court victory with a new law. However, it has to be one that the president will sign, but will not leave the Republican-majority Congress’ fingerprints on Obamacare. This is a tricky needle to thread.
Dr. Cassidy believes he can achieve this by restoring federal funding to states that will lose tax credits, but freeing them from Obamacare. To be clear: If a state wants to restore the Obamacare tax credits, it would be free to do so by establishing a state-based exchange. However, state-based exchanges are a proven failure, which no responsible governor should institute in 2015. It would be an obvious choice to take Dr. Cassidy’s other option: Receive the federal dollars and use them in a way that empowers patients, rather than the federal government.
Watching the Affordable Care Act roll-out and reading about its gestation in Steven Brill’s book, America’s Poison Pill, makes one very aware that there is a serious brain drain under way in medicine. Here’s what anyone can see:
Numbers of applicants to medical school, which once was 10 for every place, is now less than 1. Physicians are telling their children not to go into medicine. There is now more than a 7 foot stack of regulations for the Affordable Care Act. As we all know, the slogan for this whole program has been “the healthcare system is broken.” (If that is so true, why force feed new people into it?)
Some manifestations: the adoption of the ICD-10 coding system, which defines conditions needing care in such detail that there is an unacknowledged administrative cost for compliance and a substantial legal and financial risk if there is mis-coding. Another is the forced adoption of Electronic Medical Records, with rules for “Meaningful Use.” This will produce electronic oversight of all medical care, in the guise of supporting “quality of care” and facilitating “Value-based Payments.” Ultimately, the government regulators expect to have real time access to any person’s care and any physician’s performance.
One of Obamacare’s biggest cheerleaders, Families USA, has published new research showing that one third of low-income Obamacare beneficiaries have not obtained medical care due to cost in 2014:
Lower- to middle-income adults who were insured for the full year were significantly more likely than those with higher incomes to forgo needed care because they could not afford it: Nearly one-third (32.3 percent) of lower- to middle-income adults didn’t get needed medical care (excluding dental care) because they could not afford it. (p. 14)
But don’t you worry, Families USA has not thrown in the towel on Obamacare yet:
Since its passage in 2010, the Affordable Care Act (ACA) has made tremendous progress in improving access to health insurance and health care for millions of Americans. Approximately 14.1 million previously uninsured Americans gained health insurance between the beginning of open enrollment in October 2013 and March 4, 2015.
Families USA recommends that even more taxpayer-funded healthcare dollars be channeled through health insurers. Investors in health insurers must love these policy prescriptions from progressive advocacy groups.
(A version of this Health Alert has been published by Forbes. A longer version of this Health Alert has been submitted to the U.S. House of Representatives Committee on Ways & Means, Subcommittee on Health, for the May 19, 2015 hearing titled, “Improving Competition in Medicare: Removing Moratoria and Expanding Access.)
Medicare fraud is a serious problem. The Medicare bureaucracy has the power to impose moratoria on new providers in geographic or program areas it deems susceptible to fraud. However, preventing new competitors from providing Medicare benefits reduces competition and cannot reduce fraud by incumbent providers. A better way would be to give Medicare beneficiaries a financial interest in combatting fraud.
Last February, the Government Accountability Office issued its annual report on federal programs that it identifies as high risk due to their greater vulnerabilities to fraud, waste, abuse, and mismanagement. Medicare is a longstanding member of the list: “We designated Medicare as a high-risk program in 1990 due to its size, complexity, and susceptibility to mismanagement and improper payments”. A quarter of a century has gone by and Medicare is still on the list.
Imagine if you wanted to open a new hardware store and you needed a “Certificate of Need” issued by the state or local authority that your hardware store was needed. Needless to say, incumbent hardware stores would already be well armed with strong arguments that your hardware store was not needed. Crazy? Yes. Un-American? Yes. Unfortunately, these Certificates of Need exists in most U.S. states for hospitals or other facilities.
Scholars at the Mercatus Center have published a new ranking of states’ CON laws, finding that sates with Certificate of Need programs are associated with:
A story from Arizona is a cloud with a silver lining:
Teresa Anderson was pleasantly surprised how quick and hassle-free her eyelid-lift surgery was at Havasu Regional Medical Center’s outpatient-surgery facility in April 2014.
Weeks later, the bills arrived at her Lake Havasu City home. Her surgeon, anesthesiologist and X-ray provider submitted bills and were paid nearly $2,250.
Only one remained: Havasu Regional’s bill. When it finally arrived last May, what she saw shocked her. An explanation of benefits from her insurer, Blue Cross Blue Shield of Minnesota, showed she and Blue Cross had been billed $38,526 by Havasu Regional for prep work, surgery and recovery lasting less than three hours.
Anderson, who worked for a health-insurance company before her retirement, believes hospital charges like hers explain why the economics of health care are askew. And she isn’t alone. Consumer advocates say such experiences point to the need for more transparency in the pricing of medical procedures.
Before the surgery, Anderson had asked her surgeon’s staff to estimate all costs associated with the surgery. She was considering paying on her own if her insurer denied coverage. The surgeon’s staff quoted a price of $3,500 for the surgery, anesthesia and facility fee if she paid on her own without insurance.