Proposals for Universal Health Care or Back to the Health Care Future

1
Proposals for Universal Health Careor Back to
the Health Care Future

• Leonard Rodberg
• Urban Studies Dept., Queens College/CUNY
• and
• NY Metro Chapter
• Physicians for a National Health Program
• November 6, 2007

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Everybodys Got a Health Plan!
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Why Health Care Is On the Agenda
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A Declining Number of Firms Are Offering
Insurance
5
Percent with Private Insurance
And a Declining Percent of Americans
Have Private Insurance
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Rising Number of uninsured
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HIGH COST OF HEALTH INSURANCE PREMIUMS

• National Average for Employer-provided
  Insurance
• Single Coverage 4,479 per year
• Family Coverage 12,016 per year
• Note Annual income at minimum wage
  10,300
• Annual income of average
  Wal-Mart worker 17,114
• Source Kaiser Family Foundation/HRET
  Survey of Employee Benefits, 2007

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U.S. Health Costs are 70 Greater than the Median
of Other Countries
United States
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US Life Expectancy is Less than Many Other
Countries
United States
Source OECD 2005
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and its Infant Mortality is Higher
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Deaths before age 75 that are potentially
preventable with timely and appropriate medical
care.
Mortality Amenable to Health Care
Deaths per 100,000 population, 1998
Source Commonwealth Fund
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Half of Middle- and Lower-Income Adults
Experience Serious Problems Paying Medical Bills
or Insurance Premiums
Percent
Percent
50
50
48
48
38
38
33
35
23
21
Medical bills
Health insurance
Source Commonwealth Fund Survey of Public Views
of the U.S. Health Care System, 2006.
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The Outlier Nation Our Public System Covers
Fewer
United States
Source F. Colombo and N. Tapay, Private Health
Insurance in OECD Countries, OECD 2004
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While Private Insurance Dominates
United States
Source F. Colombo and N. Tapay, Private Health
Insurance in OECD Countries, OECD 2004
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But Private Insurance Pays Little More than
One-Third of the Cost Today
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Republican Approaches to Health Finance

• End employer-based insurance by eliminating the
  employers tax deduction for health insurance
• To control costs, patients (consumers) should be
  made more cost-conscious
• Higher deductibles and co-pays so insurance isnt
  so gold-plated and everyone has more skin in
  the game
• Tax credits to help individuals buy insurance

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Stephen Colbert on the Republican Health Plans
Its so simple. Most people who cant afford
health insurance are also too poor to owe taxes.
But if you give them a deduction from the taxes
they dont owe, they can use the money theyre
not getting back to buy the health care they
cant afford.
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The Good News Universal health
care is accepted as a goal by mainstream
Democratic politicians.

• The Bad News
• They define universal health care simply as
  everyone having some kind of insurance, not
  everyone having access to care.
• This wont solve the problem!

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Common Features of the New Plans

• The problem Too many uninsured
• The solution Require everyone to have insurance
• Employers contribute but dont necessarily offer
  insurance
• No regulation of insurance premiums or claims
  payment practices
• Not health care reform no change in structure at
  all
• What they have in common They preserve the
  private insurance industry and provide it with
  more customers but no more regulation.

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Mandate Model for Reform

• Proposed by Richard Nixon in 1971 to block Ted
  Kennedys National Health Insurance plan

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Mandate Model for Reform
Mandate Model for Reform
Government uses it power to force people to buy
private insurance
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Mandate Model for Reform

• Nixons program
• Employer Mandate
• Expanded Medicaid-like program for the poor and
  low-income
• Managed Care

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Whats New Since Nixon?

• Individual mandate with guaranteed issue and
  community rating
• Government assistance in purchasing private
  insurance (Health Markets, Health Choices
  Menu)
• Offer of government/public program (single
  payer?) as well as private insurance plans.
• Promised cost savings through competition,
  computerization, chronic disease management

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Seductive but Slippery Verbiage

• For those opposed to freeloading Shared
  responsibility govt., business, individuals
• For those wanting freedom Choice of plan, but
  not of doctor or hospital
• For those who are fearful Can keep what you have
• For those worried about cost Work together to
  modernize the system and make it more efficient
• For single payer advocates Can choose the
  public plan

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Top Ten Reasons Why The Mandate is Poor Public
Policy

• 10. Those without insurance may avoid seeking
  care, so enforcement will be bad for public
  health
• 9. Insurance companies will resist and
  undermine community rating and guaranteed
  issue
• 8. Financing through premium payments requires
  complex and ineffective means testing
• 7. Will not lead to universal coverage
• 6. If premium is affordable, coverage will
  not be comprehensive (co-pays, deductibles,
  exclusions)

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Top Ten Reasons Why The Mandate is Poor Public
Policy

• 5. Even more bureaucracy (e.g., Mass. Connector)
• 4. Private health insurance will be a continuing
  consumers nightmare (confusing choices, copays,
  deductibles, exclusions, denials, appeals)
• 3. Increases the cost of the system, including
  hundreds of billions of dollars of federal
  subsidies, with most going to private insurance
  companies
• 2. No cost control, leading to continually rising
  costs

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And the Top Reason Why The Mandate is Poor Public
Policy

• 1. Since there is no regulation of insurance
  company payments or practices, it will not help
  the majority of Americans who think theyre
  insured but find they cant afford health care.
• It does not solve any of the problems --
  especially rising costs -- that created the
  issue.
• It is not real health care reform.

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Whats Wrong With Offering a Public Plan vs. a
Private Plan?

• A level playing field is impossible (private
  insurance companies need subsidies to stay in
  the game).
• Private plans avoid sick people, leading to
  adverse selection for the public plan.
• Slick advertising will mislead consumers (cf.
  Medicare Advantage plans)
• Many payers remain, so the savings from single
  payer cannot be achieved.
• There is no way to control costs.

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THERE IS A SOLUTION THAT SOLVES THESE PROBLEMS

• Expand the existing Medicare program to cover
  everyone
• Improve the coverage it offers
• Eliminate private insurance

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Conyers/Kucinich/et al Expanded and Improved
Medicare for Allsingle payer national health
insurance HR 676

• Automatic enrollment - everyone receives a card
  assuring payment for all needed care
• Free choice of doctor and hospital
• Doctors and hospitals remain independent,
  negotiate fees and budgets with public agency
• Public agency processes and pays bills
• Financed through progressive taxes

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Some Implications of Medicare for All

• The same coverage for everyone No means
  testing coverage would not depend on income,
  employment or age
• Medicaid would no be longer needed
• Hundreds of billions of dollars in administrative
  costs would be saved
• Costs would be controlled through coordinated
  capital planning, budgeting, and quality reviews

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How Would It Be Paid For?One Example
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Covering Everyone and Saving Money through
Medicare for All

• Additional costs
• Covering the uninsured and poorly-insured
  6.4
• Elimination of cost-sharing and co-pays
  5.1
• Savings
• Reduced hospital administrative costs
  -1.9
• Reduced physician office costs
  -3.6
• Reduced insurance administrative costs
  -5.3
• Bulk purchasing of drugs equipment
  -2.8
• Primary care emphasis reduce fraud
  -2.2
• Net Savings
  -4.3

Source Health Care for All Californians Plan,
Lewin Group, 2005
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Why Such a National Health Insurance Program is
Possible Today

• Everyone benefits the uninsured, the
  underinsured, and everyone else who is insecurely
  insured.
• Employers will be relieved of the burden of
  rising costs and unfair competition from
  employers who don't offer insurance.
• Small businesses will contribute affordable
  payments and their employees will be covered.
• Limited reforms that keep private insurance in
  place have been tried and failed.
• Every other advanced country has done it.

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Get the Insurance Companies Out of Our Health
Care!

• If we bypass the insurance companies, we can have
  a Medicare for All system that is
• - Simpler
• - Less costly
• - Better for our health
• - Equitable, and
• - Covers everyone
• Lets do it!

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RESOURCES

• Physicians for a National Health Program
• www.pnhp.org
• PNHP New York Metro Chapter www.pnhpnymetro.org.
• Healthcare-NOW
• www. healthcare-now.org