Monday, December 21, 2020

Saturday, December 19, 2020

National Health Care Spending In 2019: Steady Growth For The Fourth Consecutive Year | Health Affairs

National Health Care Spending In 2019: Steady Growth For The Fourth Consecutive Year | Health Affairs Comment by Don McCanne In the earlier years of introducing the single payer model of health care financing to the public through various speeches, forums and the like, it was very common to receive a question from the audience demanding to know what they would have to pay in taxes for government health care because they wanted to compare that with what they were already paying, and, after all, their insurance seemed like a good plan. When asked what they were currently paying, most either didn't want to say or weren't really sure. Those who did answer the question often reported the amount of the insurance premium that was taken from the paycheck of the family's income source, plus the portion that they would have to pay in deductibles and copayments (or coinsurance if they knew what that was). Some of the more sophisticated audience members added Medicare payroll taxes, even though they were for deferred health care in their retirement years. If you add those up, it might seem like health care costs are more reasonable than a comprehensive government program would cost. But what were the audience members leaving out? What are some of the relatively hidden expenses of health care? * Most are not aware of the exact amount of the employer's contribution to the employer-sponsored health plans - an amount that is usually much larger than the employee's payroll deduction for the plan. Also, of great importance, most economists agree that the employer's contribution is actually paid by the employee in the form of forgone wage or salary increases, though many do not realize that. * The funding of Medicare is complex. The Medicare Hospital Insurance Trust Fund is funded not only through payroll taxes but also through income taxes paid on Social Security benefits, interest earned on the trust fund investments (the people's money), and Medicare Part A premiums from people who aren't eligible for premium-free Part A. The Supplementary Medical Insurance Trust Fund is funded by general funds authorized by Congress (our taxes), premiums for Medicare Part B (medical insurance) and premiums for Medicare Part D (drug coverage), and other sources such as interest on the trust fund investments. Those receiving Medicare services also have to pay deductibles and coinsurance, although that might be covered by another plan for which premiums must be paid either directly or indirectly. The option of private Medicare Advantage plans adds further complexity to the calculations. So it is difficult for each person to determine exactly what they are paying for Medicare. * Without going into detail, Medicaid is funded by both federal and state taxes, which we pay even though the benefits go only to low-income individuals. * One of the larger funding sources is the tax expenditure that we pay for the deductions received by employers (actually, by extension, the employees) for the employer contribution to employer-sponsored health plans. Actually this is a relatively cruel policy in that these taxpayer subsidies to employer-sponsored plans are inversely related to income - higher-income individuals receive much higher taxpayer support than do lower-income individuals. * Government employees on the federal, state, and local levels tend to have a major portion of their health plan premiums paid by the government, which, of course, means paid by us the taxpayers. * Whenever you purchase products or services, included in the price is overhead expenses and that includes employer-sponsored health plans. That is not only for the original producer of the products or services, but it is also for all of the intermediaries such as shippers, retailers, employees of business insurers and endless other employees that support the production and distribution of products and services that we receive. Of course, some of this is double-counting health spending already listed, but it is important to understand the flow of money into our health care system. * The complexity of health care costs creates a tremendous amount of expensive administrative excesses for which we all end up paying. Again, some of this may be double-counted, but it is particularly important to understand that much of this waste would be recoverable with the enactment and implementation of a single payer Medicare for All. * You can likely think of other sources of health care spending that should be included here. The Milliman Medical Index is an estimate of the health care costs for a hypothetical family of four covered by an average employer-sponsored preferred provider organization (PPO) plan. For 2020, that amount is $28,653. Keep in mind that America's workforce and their young families are a relatively healthy sector of the U.S. population. For other sectors, the cost may be significantly greater. So how much do we really pay for health care? According to the current release from the CMS Office of the Actuary, our national health expenditures for 2019 were $3.8 trillion. With a 2019 U.S. population of 328.2 million, that is an average expenditure of $11,578 per person. For a family of four that would be about $46,000, considerably more than the $28,000 estimate by the Milliman Medical Index. But that shows how difficult it is to break down the cost for each individual or family who would want to compare what they believe they are spending with the cost for each individual in a Medicare for All program. Many studies have been done of what the cost of a single payer would be and how that would compare to what we are currently spending. Very roughly the average cost for most of us would be about 5 percent less than what we are spending (median 3.5 percent by the Cai et al study). Only the very wealthy would pay more but not near enough to be detectable by a change in their lifestyles. So how much are you, as an individual, spending on health care now? As you can see it is so complex that it would be almost impossible to estimate. So we have to settle with averages. So how much will you spend in taxes to pay for single payer Medicare for All? That also will vary for each individual, but we can say that it will be equitable and affordable since the financing will be through progressive taxes based on each individual's ability to pay. People worry about the taxes but if they just focus on the fact that the taxes will be fair and affordable, then they can celebrate knowing that they will have quality health care of their own choosing whenever and wherever they need it, for life! Nothing else on the horizon promises that.

Tuesday, December 15, 2020

Income-Related Inequality In Affordability And Access To Primary Care In Eleven High-Income Countries | Health Affairs

Income-Related Inequality In Affordability And Access To Primary Care In Eleven High-Income Countries | Health Affairs: A high-performing health care system strives to achieve universal access, affordability, high-quality care, and equity, aiming to reduce inequality in outcomes and access. Using data from the 2020 Commonwealth Fund International Health Policy Survey, we report on health status, socioeconomic risk factors, affordability, and access to primary care among US adults compared with ten other high-income countries. We highlight health experiences among lower-income adults and compare income-related disparities between lower- and higher-income adults across countries. Results indicate that among adults with lower incomes, those in the US fare relatively worse on affordability and access to primary care than those in other countries, and income-related disparities across domains are relatively greater throughout. The presence of these disparities should strengthen the resolve to find solutions to eliminate income-related inequality in affordability and primary care access. Comment by Don McCanne The results of another in the series of studies by The Commonwealth Fund on the health care systems of eleven wealthy nations should surprise no one who has followed the prior studies. The United States is last again, this time in income-related inequality in affordability and access to primary care. The Health Affairs study: "Results indicate that among adults with lower incomes, those in the US fare relatively worse on affordability and access to primary care than those in other countries, and income-related disparities across domains are relatively greater throughout." The Commonwealth Fund report (same authors): "Achieving greater health equity in the U.S. will likely require policies that extend insurance coverage, make health care easier to afford, and strengthen primary care. The study authors also say that greater investments are needed to address the social determinants of health — factors beyond traditional health care, such as housing, education, and nutrition, that also affect people’s health. The U.S. in particular, they say, has much to gain from examining the experience of countries where universal health coverage ensures people have access to affordable health care." When we are already spending more than enough to fix our health care system, far more than any other nation, how much longer are we going to stand in shame and embarrassment before other wealthy nations that obtain much better results with far less per capita spending than we have in the U.S.? For starters, we should enact and implement single payer Medicare for All. That will take care of health care for everyone without costing us any more than we are already spending. Then tending to other socioeconomic needs should move us up to first place, or close to it.

Sunday, December 13, 2020

CBO's methods of analyzing single payer Medicare for All

Congressional Budget Office December 2020 How CBO Analyzes the Costs of Proposals for Single-Payer Health Care Systems That Are Based on Medicare’s Fee-for-Service Program By CBO’s Single-Payer Health Care Systems Team Abstract In this paper, CBO describes the methods it has developed to analyze the federal budgetary costs of proposals for single-payer health care systems that are based on the Medicare fee-for-service program. Five illustrative options show how differences in payment rates, cost sharing, and coverage of long-term services and supports under a single-payer system would affect the federal budget in 2030 and other outcomes. CBO’s projections of national health expenditures under current law are a key basis for the estimates. CBO projects that federal subsidies for health care in 2030 would increase by amounts ranging from $1.5 trillion to $3.0 trillion under the illustrative single-payer options—compared with federal subsidies in 2030 projected under current law—raising the share of spending on health care financed by the federal government. National health expenditures in 2030 would change by amounts ranging from a decrease of $0.7 trillion to an increase of $0.3 trillion. Lower payment rates for providers and reductions in payers’ administrative spending are the largest factors contributing to the decrease. Increased use of care is the largest factor contributing to the increase. Health insurance coverage would be nearly universal and out-of-pocket spending on health care would be lower—resulting in increased demand for health care—under the design specifications that CBO analyzed. The supply of health care would increase because of fewer restrictions on patients’ use of health care and on billing, less money and time spent by providers on administrative activities, and providers’ responses to increased demand. The amount of care used would rise, and in that sense, overall access to care would be greater. The increase in demand would exceed the increase in supply, resulting in greater unmet demand than the amount under current law, CBO projects. Those effects on overall access to care and unmet demand would occur simultaneously because people would use more care and would have used even more if it were supplied. The increase in unmet demand would correspond to increased congestion in the health care system—including delays and forgone care—particularly under scenarios with lower cost sharing and lower payment rates. Working Paper 2020-08 (208 pages): Blog by CBO Director Phillip Swagel: === Comment by Don McCanne As stated in the Abstract, "In this paper, CBO describes the methods it has developed to analyze the federal budgetary costs of proposals for single-payer health care systems that are based on the Medicare fee-for-service program." Since their reports are provided for Congress, the emphasis is on federal spending rather than on our total national health expenditures. There should be no surprise that they do predict an increase in federal spending since the design of a single payer system does precisely that; it shifts health care spending to the federal government since financing is primarily through the tax system. They do indicate that total national health expenditures would not change much when compared to our current spending, estimating somewhere between a decrease of $0.7 trillion to an increase of $0.3 trillion. They may have underestimated the savings in that, though they do credit the savings from the reduction of the administrative waste of the private insurers, they do not seem to quantify the very large savings from the reduction of the administrative burden placed on the health care delivery system, though they do acknowledge it as being a source of improved efficiency in the system. A recent systemic review by Christopher Cai, James Kahn and colleagues of twenty economic analyses of single payer indicate that they would all result in long-term net savings. In indicating that increased demand would produce "increased congestion" in the health care system, they seem to underestimate the ability of the system to self-correct by giving a lower priority to services that are not of much benefit, though queue management is still important in any system. Some of the experts consulted previously have been criticized for some of their assumptions in their single payer work, and others are experts in the aged and long term care and are not noted for their single payer work. There is also a notable absence of other academics who have long-standing reputations for their credible contributions to the single payer literature. In spite of that, this CBO report is still very useful in that it does what it says it does; it provides a description of CBO's methods of analyzing single payer and thus would be helpful in understanding future single payer reports from them.

qotd: Stuart Butler's proposal for an equitable national health system - - Gmail

qotd: Stuart Butler's proposal for an equitable national health system - - Gmail Comment by Don McCanne Many will remember that it was Stuart Butler who created the Heritage Foundation model that was used as the framework for the Affordable Care Act. It was selected by the Democrats as a model that would have the support of the Republicans because of its conservative bona fides. As it turned out, though the Republicans initially cooperated, it was decided that it was more important to deny President Obama a political success, and so the Republicans fought the measure, requiring the Democrats to make compromises that fell quite short of the equitable, comprehensive reform they intended. Stuart Butler was not really satisfied with the result either. In the meantime, he wisely moved from the Heritage Foundation which had taken a more reactionary turn, and aligned himself with the moderate Brookings Institution. With the election of Joe Biden as president, an opportunity has arisen to repair the defects in the original ACA legislation, and so Butler presents his views here on what he believes would be "a bipartisan path to an equitable, inclusive, and comprehensive American health system." If you believe that reform should be based on making improvements in the Affordable Care Act, as Biden has supported, then the proposal is an effective model of expanding coverage and making it more equitable. It is important to understand it since it is likely that it, or a very similar model, will have strong support by the Biden camp, fulfilling his stated desire to work across the aisle. Just as ACA provided beneficial changes in health care financing, this expansion and correction would as well. But there are very serious deficiencies in this proposal. Above all, it would leave in place most of the current, highly inefficient, administratively complex and costly health care financing infrastructure which is a major cause of our outrageously high health care costs. In fact, of all of the models of reform, this is perhaps the most expensive, when achieving affordability is one of the primary goals of reform. Butler points out that his model would be bipartisan because it includes specific policies that come from each side of the political spectrum and some policies on which there is mutual agreement. Although the policies expanding health care justice would certainly be welcome, other policies that further privatize the system, such as a move towards private Medicare Advantage for All, should be rejected since private plans have been responsible for many of the injustices in health care today. We've stated several times before that we need to get the policy right and then change the politics to enable enactment and implementation of those policies. Butler has it backwards. He is trying to clear the political hurdles by accepting flawed policies that would appeal to the ideological preferences of those on the right, assuming that the left will accept any compromises as long as reform is advanced, as they did with ACA. If we want the most affordable program that is truly universal, comprehensive, and especially is equitable, then we need to enact a well designed, single payer, improved Medicare for All, but we'll need to travel the rough political road of convincing Joe Biden that Medicare for All is what we want and need. In the meantime, try to understand Stuart Butler's proposal so we can explain to President Biden and everyone else why we do not want to go that route.