People Are Not Very Satisfied with Their Health Plans


The Employee Benefit Research Institute (EBRI) has just released a survey of beneficiaries in traditional health plans, high-deductible health plans (HDHPs), and consumer-driven health plans (CDHPs). EBRI defines a CDHP as a HDHP with a Health Savings Account or Health Reimbursement Arrangement. What is interesting about the results is that satisfaction in traditional plans dropped significantly in 2010 and has never recovered. Although satisfaction with HDHPs and CDHPs is worse than with traditional plans (because of higher out-of-pocket payments), they have not suffered the same drop. However, having an HSA or HRA really improves satisfaction: Last year, 47 percent of CDHP beneficiaries were satisfied, versus only 40 percent of HDHP beneficiaries. On the other hand, only 58 percent of beneficiaries in traditional plans were satisfied.


Obamacare Enrollment is Shrinking


After Obamacare’s first open enrollment ended, the Administration stopped releasing enrollment figures. Jed Graham (no relation) of Investors Business Daily has been following the health insurers, and has come to a startling conclusion — Obamacare enrollment is dropping:

The nation’s third-largest health insurer had 720,000 people sign up for exchange coverage as of May 20, a spokesman confirmed to IBD. At the end of June, it had fewer than 600,000 paying customers. Aetna expects to fall to “just over 500,000″ by the end of the year.

Cigna (NYSE:CI) said that it expects its individual market customers, including more than 100,000 in the exchanges, to “move from 300,000 down to 280,000 in that range,” Cigna CEO David Cordani said in a conference call.

What is To Be Done with Health Insurance Exchanges, Post-Obamacare?


Any time a Republican politician suggests that there is anything positive in Obamacare, the media are eager to declare this means the Republican establishment is backing away from repealing the Affordable Care Act and wants to “fix” it instead.

This, of course, is what most businesses and their lobbyists would prefer take place. It is consistent with the Kaiser Family Foundation’s drumbeat of monthly polls reporting that “over half the public has an unfavorable view of the Affordable Care Act (ACA) in July, up eight percentage points since last month,” but that a “majority continues to prefer Congress improve ACA rather than repeal and replace.”

The latest exhibit is a report in the Wall Street Journal that U.S. Senator Bob Corker (R-TN) thinks that “we could build on the exchange concept.” What? Build on a legacy of bloated and broken IT contracts, which swallowed up billions of dollars (including $655 million on three state-based exchanges that shut down after a few months of operation) and failed in so many different ways to enroll people properly?

“Building” on that would be a strange way to “fix” Obamacare. Fortunately, a member of Senator Corker’s staff has told me privately that he meant nothing of the sort. Instead, what he meant was expressed in a rhetorical question reported below the lede in the Wall Street Journal:

“Don’t we really want individuals in our country to have their own health insurance?” Mr. Corker said, backing the ability of individuals to take their health insurance with them as they change jobs and “move away from being dependent on employers where people feel locked in.”

7.2 Million More Americans Dependent on Medicaid since Obamacare Opened


The Center for Medicare & Medicaid Services (CMS) has just released more data corroborating our previous conclusion that Obamacare is mostly an expansion of welfare dependency:

The 48 states reporting both June 2014 enrollment data and data from July-September 2013 report total enrollment in June of over 65 million individuals, and July-September 2013 average enrollment of 58 million. For June 2014, we are reporting growth of 7.2 million compared to July-September 2013…

What is really remarkable is that the government thinks this is something to be proud of. It is a far greater number than the increase in those enrolled in individual plans (even with Obamacare subsidies), and will impose a significant drag on employment growth as long as Obamacare’s Medicaid expansion persists.

Fourth Month of Healthcare Price Inflation; Longest Trend since January 2012


increaseThe Altarum Institute’s latest Price Brief shows that prices of healthcare goods and services are rising:

In June 2014, the health care price index (HCPI) rose 1.7% above June 2013. The 12-month moving average of 1.3% is near the all-time low for our data (1.2%), but it has now risen for four straight months, the first increasing trend since January 2012.

Healthcare Prices Flummox the Experts


The absurdity of our healthcare pricing is never more clear than when described by experts — people who study the system for a living — who become patients and are shocked and confused by the bills that hit them. Here are three examples:

1. Paul Keckley, PhD, is one of the top consultants in the healthcare sector. From 2006 to 2013, he ran the Deloitte Center for Health Solutions, a period during which it rose to prominence and produced excellent research. Well, Mr. Keckley has just undergone knee-replacement surgery:

This week, I started getting the bills: the whopper $51,829.35 from the hospital for my 55-hour stay. And that doesn’t include professional fees for my surgeon, internist and anesthetist, the 3 medications I now take, the crutches and walker I bought, and the over-the-counter aids I’ve purchased. In all likelihood, the final tally will be close to $60,000. Wow.

The Patient Care Quarterback


The New England Journal of Medicine recently published an article by Matthew J. Press, MD, about the need for patients to have a quarterback to coordinate the team of care-givers. Dr. Press writes –

Care coordination is now a high priority in health care and is the backbone of new models of care, such as accountable care organizations, that aim to improve quality and reduce costs. But it remains an abstract concept to many people who are not on the front lines of clinical care, as well as to some on the front lines who lack (or don’t want to have) the quarterback’s view of the field. In replaying the highlights, we can learn some important lessons about care coordination.

Silicon Valley Plans to Bring Digital Health to Seniors


Happy Older Couple in Beach ChairsDigital health apps and wearable devices generally attract a niche market of young, healthy individuals and fitness enthusiasts. However, this may shift in 2014 as startup companies are shifting their digital health funding to focus on seniors.

A report sponsored by Startup Health and AARP found digital health startups are targeting the aging population. Digital health funding for seniors more than doubled at $928 million by the end of 2013, compared to $413 million at 2010.

Libertarians against Innovation?


Two researchers at the Mercatus Center, a think tank that produces excellent research on any number of economic issues, have published a challenge to intellectual property — trademark, copyright, and patents. The paper ridicules claims made by a number or sources in the last few years that laws which protect intellectual property (IP) create jobs. For example, The U.S. Chamber of Commerce’s Global Intellectual Property Center, which estimates that 55.7 million jobs are created by IP. The paper challenges the evidence presented by these sources, and rebuts them with — to be blunt — a purely theoretical, evidence-free argument that:

Proponents of the IP-created-jobs argument also tend to underestimate the extent to which resources not spend on IP-protected products are spent elsewhere. Other issues aside, this means that stronger IP protection is more likely to change the distribution of employment than the overall number of jobs.

Have Faster FDA Approvals Caused More Drug Safety Problems? No!


A version of this Health Alert appeared at Forbes.

The media gave some attention to a new study, which suggests that the Food and Drug Administration (FDA) recklessly allows unsafe new prescription drugs onto the market. The research supports a longstanding suspicion that the Prescription Drug User Fee Act (PDUFA), first passed in 1992 and renewed every five years, has caused the FDA to view the research-based pharmaceutical industry as a “partner” and source of revenue, rather than a regulated industry.

Before PDUFA, the FDA was funded by general appropriations. PDUFA has allowed the FDA to increase its revenue by user fees, which drug-makers agree to pay for new drug approvals or facilities inspections. PDUFA was last renewed in 2012. At the time, I endorsed the renewal because there was no likelihood of Congress reducing the FDA’s power: PDUFA was the best way to ensure drug approvals kept moving at the FDA.

These researchers think that’s a bad thing. According to the lead author, Cassie Frank, a physician at Harvard Medical School: “The FDA is under constant pressure to rush new drugs through the pipeline to approval. In its hurry, the FDA is apparently failing to distinguish useful drugs from toxic ones, and more dangerous drugs are slipping through. By the time many drugs receive serious safety warnings, millions of Americans have already been exposed to their side effects, which can sometimes be fatal.”

This conclusion is sensationalist, to put it mildly.

The authors examined drugs approved from 1975 through 2009 and found that drugs approved after PDUFA’s passage were more likely to receive a new black-box warning or be withdrawn than drugs approved before its passage (26.7 per 100 drugs versus 21.2 per 100 drugs at up to sixteen years of follow-up).