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ObamaCare in the Granite State

The only exchange option afforded to consumers comes from Anthem Blue Cross and Blue Shield, a unit of WellPoint. The insurer built a narrow network that lowered premiums by 25% or 30% while still complying with ObamaCare’s other mandates…

…Of the 26 in-state acute care hospitals, 10 were booted from Anthem’s network (not counting emergency services). Even the state capital of Concord was shut out, and the coverage gaps are wider because so many primary care and specialist practices are now owned by health systems.

The Granite State didn’t lack for insurers before. Anthem dominated with 40.7% of all private policies, but strong rivals included Harvard Pilgrim (20.4%), Cigna (18.7%) and Aetna (7.8%). Anthem did have a 76% share of the individual market, but aren’t the exchanges supposed to increase competition? (WSJ)

Why We Spend So Much on Drugs

The editors at Bloomberg explain:

prescription-bottleHere’s how the system works: When a doctor administers a drug in his or her office, Medicare pays 106 percent of its average selling price. The doctor keeps the extra as compensation for administering the injection.

What has this got to do with eye doctors? The drug Lucentis, used to treat macular degeneration, cost Medicare almost $2,000 a shot in 2012. Another drug, Avastin, which works just as well, costs about $50. If you were the doctor, faced with a system that pays you 6 percent of the drug’s cost, which would you choose? That Medicare spent a total of about $1 billion on Lucentis in 2012 suggests most ophthalmologists went with the more expensive one.

It gets worse:

This problem goes beyond a single drug. Of the $20 billion Medicare spent on drugs administered by doctors in 2010, 85 percent went to the 55 most expensive ones. In what seems unlikely to be a coincidence, 42 of those drugs also showed an increase in use from 2008 to 2010.

Hits and Misses

Woman Using Exercise MachineIs the motivation to exercise in your genes?

Does marijuana wreck your brain? Or was the study so much hype?

Readmissions: They may not be the hospital’s fault.

After years of failed attempts, researchers have finally generated stem cells from adults using the same cloning technique that produced Dolly the sheep in 1996.

About 16% of people who die in traffic crashes in the U.S. are bikers or pedestrians. Phoenix and Fresno are the worse cities for bikers. Detroit and Miami are the worse for pedestrians.

Good News for the Uninsured

Uninsured patients who seek trauma care at a Healthcare Corporation of America hospital will no longer be charged a special trauma fee, which sometimes added as much as $30,000 to their bills…

“Even so, waiving the trauma fees for uninsured HCA patients might have little impact. Hospitals generally collect only a portion of what they bill patients. And the amount collected from uninsured patients — compared to those covered by auto or health insurance policies — can be tiny.”

HCA told the newspaper that their hospitals collect $300 on average from uninsured patients. (More)

To Be Governed

elderly-man-worriedA long list of services do qualify as preventive care under the Affordable Care Act, including vaccinations and screenings for diabetes, depression, high blood pressure, high cholesterol and several cancers. Most insurers will cover one such preventive visit per year with no charge to the patient.

But care related to existing health problems, or new issues, is considered “evaluation and monitoring,” not preventive…

Some offices now ask patients to schedule separate annual visits — one for preventive care (with no out-of-pocket cost) and one to discuss problems (with the usual deductible and copay). Medicare also encourages preventive care with its annual free “wellness” visits. But when elderly patients learn they can’t bring up ongoing health issues at such a visit without being charged, many don’t bother, doctors say. (WSJ)

Why ObamaCare is Never Likely to be Popular

Jonathan Bernstein at Bloomberg View:

Caduceus with First-aid KitFor most of us, ObamaCare isn’t that visible, and the benefits often are the least visible part. The biggest winners are probably those on expanded Medicaid, and I’m confident many of them don’t know they were helped by ObamaCare. Don’t expect it to get better; it’s going to be less and less likely that people will identify the benefits they are receiving with “ObamaCare.” In five years, plenty of those in the exchanges won’t realize that under the old system they would have had a pre-existing condition that would have barred them from being insured. Even if they realize that such a restriction once existed, they almost certainly won’t realize that their minor medical condition would have qualified.

Given all that, once Republican opposition guaranteed that the ACA would be controversial it was likely that it would poll badly, even if it worked well — and even if it worked so well it couldn’t be repealed.

Headlines I Wish I Hadn’t Seen

When America’s joint surgeons were challenged to come up with a list of unnecessary procedures in their field, their selections shared one thing: none significantly impacted their incomes.

Kathleen Sebelius for U.S. Senate?

Income Inequality Institute creates more inequality by paying Paul Krugman $25,000 a month — no teaching required.

Will Vermont Ever Get a Single-Payer System?

money-rollsJust two small issues need to be resolved before the state gets to all systems go: First, it needs the federal government to grant waivers allowing Vermont to divert Medicaid and other health-care funding into the single-payer system. And second, Vermont needs to find some way to pay for it.

Although Act 48 required Vermont to create a single-payer system by 2017, the state hasn’t drafted a bill spelling out how to raise the additional $1.6 billion a year (based on the state’s estimate) the system needs. The state collected only $2.7 billion in tax revenue in fiscal year 2012, so that’s a vexingly large sum to scrape together…

Paying for this program would likely make Vermont the highest-taxed state in the nation, by quite a lot.

Megan McArdle.

Is The Health Care Spending Slowdown Over?

risingAmericans used more medical care in 2013 as the economy recovered, new reports show. Federal data suggests that health care spending is now growing just as quickly as it was prior to the recession.

“We’re at the highest level of growth since the slowdown began,” Paul Hughes-Cromwick, a senior health economist at the Altarum Institute, which tracks health spending. “You have to go back seven years to see growth like this.”

Sarah Kliff.

Did You Fill Out Your Tax Return Correctly?

Toy Businessman on a Pile of MoneyThe results for the EITC are not pretty. The Internal Revenue Services estimates that 21 to 25 percent of EITC payments were issued incorrectly during the fiscal year 2012, totaling from $11.6 to $13.6 billion in too much money being paid out to taxpayers. As a result, the Office of Management and Budget has labeled the EITC a “high-error” government program. Projections by the government show that the rate of error is expected to remain stubbornly high.

…[T]he IRS estimates that 21 percent of those who are eligible do not claim the credit at all. And so the EITC cuts both ways: both too much being handed out to taxpayers and too little.

Jia Lynn Yang.