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passerine[Crossposted to LJ and DW accounts.]
Since I used to work for a health insurance company, and I still work with Medicaid reimbursement rates, I know some people were interested in having me tackle this topic.
One important question in the "Health care debate" is as follows:
Are you looking at health care coverage, or at health insurance?
Universal coverage and universal insurance are not at all the same things, although theoretically universal insurance would be a way of getting to at least near-universal coverage.
This post is mostly looking at how financing a reformed but still "insurance-based" system would work, in my ideal framework. There's still plenty of stuff it doesn't fully address, both things I've thought of and things I haven't, so it's not as if I'm saying 100% yes this is what should be done. It's just the point I would start from.
Issues I am considering:
- Health insurance used to be something meant for catastrophic expenses, sort of like - well, like most insurance coverage we have for other things. Life insurance, disability insurance, car insurance, homeowner's or renter's insurance, etc. The main difference is that because primary and preventive care are so important to decreasing the likelihood of catastrophic expenses, insurance companies got into the business of covering them, and that's where things get sticky.
- The above is the conceptual problem here. As such, the scapegoating of various populations and groups (fat people, malpractice lawyers and the people who hire them, Big Pharma, all insurance company employees, women, or whoever else) does not address the actual issue.
- Also, as a result of the current system, nobody has any idea of the actual cost of any given service. A thorough physical examination does NOT cost $20.
- Employer-based insurance plans create huge problems for businesses and workers and, really, everyone. Many smaller companies can't afford to pay a "decent wage" and "decent health benefits". In New York, a common solution to that problem is the small business version of Healthy New York, but that has major problems of its own (notably, the complete LACK of mental health benefits, in a state that has a mental health parity law - apparently the state doesn't have to follow its own laws). There is also the problem of certain larger employers who assume their workforce is healthier than average pulling out of the common insurance pool and going "self-funded", which then jacks up the premiums paid by the businesses who can't or choose not to self-fund.
- Moving to a true single-payer system would, as an unintended consequence, put a hell of a lot of people out of work. I'm not talking big-money executives, but the people like my co-workers at my old job, who were getting paid around $10 to $12 an hour back in 2002 for application screening and related data entry work, and the customer service representatives who made maybe slightly more than that. There were a lot of us - in fact, my former company was one of the largest employers in the Rochester area. Customer service work there was a common career change for home health aides who were physically or psychologically unable to keep working as home health aides, or who needed a little more money than they were being paid. Likewise, RNs who were no longer able to do direct patient care for whatever reason would often come to work there as utilization review staff and the like. Even WITH single-payer health care in place, the social safety net is not economically or politically strong enough to withstand that kind of additional burden.
- A commonly-named fear where health insurance reform of any kind is concerned is that of further loss of control over health care benefits than folks already experience under the current system. This fear is not entirely baseless, especially because the current system frequently just plain sucks.
- Medicaid currently covers, and under Federal mandates (even if no reform occurs) will continue to cover the most expensive populations - those that require inpatient care or need significant outpatient services on at least a multiple-times-per-week basis to avoid requiring inpatient care. The "optional expansions" of Medicaid (including such things as Family Health Plus in NY) do NOT have anywhere near the cost-per-capita of the mandated categories, yet when states need to cut their budgets they talk about the expanded-coverage of Medicaid as if it is a serious cost-driver.
- Relatedly, all the controversy about "death panels" notwithstanding, it is very much the case that for most people, it's the last years of life that will be the most expensive, health-care wise. And the elderly and adjudicated-disabled are already the ones that Federal mandates require us to cover, so those costs are going to keep going up regardless of whether or not there is meaningful reform for the rest of us - unless we as a culture are able to grow up a little bit and have a serious conversation about what treatments only prolong the inevitable, and at what cost to quality of life.
- While I don't like all the conspiracy-nuttery that surrounds discussion of "Big Pharma", I do think that it would be a very good idea if the newest and most expensive psychiatric drugs were NOT the first things given to Medicaid holders who need psychiatric medication, and I've seen this happen often enough that I believe it's pretty common practice. (I'll make an exception for Strattera here, admittedly with some bias because it's what I take, but the issue in that case is shiny new expensive drug versus controlled substance. I certainly can understand wanting to prescribe something with a lower potential for misuse and lower blackmarket value as the first-line choice. However, prescribing a cocktail of two or three new brand-name drugs, one of which is off-label, before trying the generics that are approved for the same purpose as what this cocktail is supposed to be doing? Not so much.) I don't know if the same thing is done with other illnesses, because I know a lot more about psych meds than about prescription drugs in general, but in any case there shouldn't be the assumption that New Means Better, except for those very rare cases where something is a significant breakthrough.
- Quite a lot of stupid shell games get played with "cutting expenses" that only make for more expense in the end. For example, the former situation (recently remedied by a new law) of kidney transplant patients losing coverage for the expensive anti-rejection drugs after 36 months and being unable to afford them independently, therefore leading to another instance of kidney failure. And guess what? The same plan that wouldn't cover the anti-rejection drugs after 36 months WOULD cover the MUCH more expensive ongoing dialysis, another kidney transplant, and THEN another 36 months of drugs. Lather, rinse, repeat. This is why any proposal to save money needs to be thought out as far as whether or not it actually DOES save money.
With that as background, here is approximately what I would propose if I were running things, with actual numbers possibly varying:
- A voucher system for primary care practitioners (family doctors, internal medicine doctors, OB/GYNs, pediatricians, nurse practitioners, midwives, possibly certain primary alternative practitioners if the state allows it such as naturopaths) to receive direct government reimbursement for annual physicals, well-child visits on the recommended schedule, and prenatal care on the recommended schedule. Those services should be available for the same reasons that public K-12 education, road maintenance, emergency response services, etc. should be available. These vouchers should be sufficient to pay for the actual costs of such care. (Undecided whether dental and vision should be included in this or not. Probably not the worst idea, but I realize it would add a certain degree of additional expense.)
- For other services, something similar to the flex-spending account/high deductible health plan system. Everyone has a medical account funded to, say, $6,000 annually. Individuals pay into this on a sliding-scale based on household income - they may choose to send in funds on an annual or quarterly basis (possibly as part of income tax filing) or to have it withheld from salary or other payments.
- Anything legally recognized as a health care good or service, provided by a legally-recognized health care provider, may be paid for from this account, much the way that flexible spending accounts currently work. Part 2 will have more about that.
- One of the things that is paid for from this account is a catastrophic-coverage health insurance plan. Everyone must have coverage from such a plan, and all plans sold must meet certain minimum standards in terms of coverage provided and deductible limitations. (This would be similar to how car insurance works. Certain coverage is mandatory; additional coverage is available for an additional charge if desired. There would be a default "risk pool" option for coverage that meets the basic legal requirements if the insured couldn't qualify on the regular market, much as there is for car insurance.)
- The money stays in the plan and rolls over from year to year. It is meant to be available when needed for appropriate expenses. It can be held in any federally-insured interest-bearing account in any financial institution that will accept such plans.
- If there is a circumstance in which funds from the account are exhausted but the catastrophic plan hasn't kicked in, or if the catastrophic plan gets exhausted, the next step would be a system of guaranteed medical loans much like guaranteed student loans work, with a lien against the future pay-ins to the medical account.
- One issue I can't decide is whether children to age 21 should automatically be covered without parents needing to pay in on the sliding scale, or whether they should be subject to the same requirements. I can make a good case for both options - on the one hand, kids ought to be covered regardless of their parents' financial or other mistakes; on the other hand, families that CAN afford the coverage without help SHOULD afford it. Overall, I think I would be in favor of funding the plans in full for children to age 21 until such time as the broken "federal poverty level" standards get fixed to deal with such problems as regional differences in cost of living and the fact that 3 times the monthly cost of food doesn't work as a basis for minimum living expenses. (But that's an ENTIRELY other problem.)
I know this solution isn't perfect, that there are plenty of holes in it, but I think it's the closest to getting universal coverage in place, to de-coupling employment from coverage, and to making sure that people who can afford to pay do so that I can come up with.
Since I used to work for a health insurance company, and I still work with Medicaid reimbursement rates, I know some people were interested in having me tackle this topic.
One important question in the "Health care debate" is as follows:
Are you looking at health care coverage, or at health insurance?
Universal coverage and universal insurance are not at all the same things, although theoretically universal insurance would be a way of getting to at least near-universal coverage.
This post is mostly looking at how financing a reformed but still "insurance-based" system would work, in my ideal framework. There's still plenty of stuff it doesn't fully address, both things I've thought of and things I haven't, so it's not as if I'm saying 100% yes this is what should be done. It's just the point I would start from.
Issues I am considering:
- Health insurance used to be something meant for catastrophic expenses, sort of like - well, like most insurance coverage we have for other things. Life insurance, disability insurance, car insurance, homeowner's or renter's insurance, etc. The main difference is that because primary and preventive care are so important to decreasing the likelihood of catastrophic expenses, insurance companies got into the business of covering them, and that's where things get sticky.
- The above is the conceptual problem here. As such, the scapegoating of various populations and groups (fat people, malpractice lawyers and the people who hire them, Big Pharma, all insurance company employees, women, or whoever else) does not address the actual issue.
- Also, as a result of the current system, nobody has any idea of the actual cost of any given service. A thorough physical examination does NOT cost $20.
- Employer-based insurance plans create huge problems for businesses and workers and, really, everyone. Many smaller companies can't afford to pay a "decent wage" and "decent health benefits". In New York, a common solution to that problem is the small business version of Healthy New York, but that has major problems of its own (notably, the complete LACK of mental health benefits, in a state that has a mental health parity law - apparently the state doesn't have to follow its own laws). There is also the problem of certain larger employers who assume their workforce is healthier than average pulling out of the common insurance pool and going "self-funded", which then jacks up the premiums paid by the businesses who can't or choose not to self-fund.
- Moving to a true single-payer system would, as an unintended consequence, put a hell of a lot of people out of work. I'm not talking big-money executives, but the people like my co-workers at my old job, who were getting paid around $10 to $12 an hour back in 2002 for application screening and related data entry work, and the customer service representatives who made maybe slightly more than that. There were a lot of us - in fact, my former company was one of the largest employers in the Rochester area. Customer service work there was a common career change for home health aides who were physically or psychologically unable to keep working as home health aides, or who needed a little more money than they were being paid. Likewise, RNs who were no longer able to do direct patient care for whatever reason would often come to work there as utilization review staff and the like. Even WITH single-payer health care in place, the social safety net is not economically or politically strong enough to withstand that kind of additional burden.
- A commonly-named fear where health insurance reform of any kind is concerned is that of further loss of control over health care benefits than folks already experience under the current system. This fear is not entirely baseless, especially because the current system frequently just plain sucks.
- Medicaid currently covers, and under Federal mandates (even if no reform occurs) will continue to cover the most expensive populations - those that require inpatient care or need significant outpatient services on at least a multiple-times-per-week basis to avoid requiring inpatient care. The "optional expansions" of Medicaid (including such things as Family Health Plus in NY) do NOT have anywhere near the cost-per-capita of the mandated categories, yet when states need to cut their budgets they talk about the expanded-coverage of Medicaid as if it is a serious cost-driver.
- Relatedly, all the controversy about "death panels" notwithstanding, it is very much the case that for most people, it's the last years of life that will be the most expensive, health-care wise. And the elderly and adjudicated-disabled are already the ones that Federal mandates require us to cover, so those costs are going to keep going up regardless of whether or not there is meaningful reform for the rest of us - unless we as a culture are able to grow up a little bit and have a serious conversation about what treatments only prolong the inevitable, and at what cost to quality of life.
- While I don't like all the conspiracy-nuttery that surrounds discussion of "Big Pharma", I do think that it would be a very good idea if the newest and most expensive psychiatric drugs were NOT the first things given to Medicaid holders who need psychiatric medication, and I've seen this happen often enough that I believe it's pretty common practice. (I'll make an exception for Strattera here, admittedly with some bias because it's what I take, but the issue in that case is shiny new expensive drug versus controlled substance. I certainly can understand wanting to prescribe something with a lower potential for misuse and lower blackmarket value as the first-line choice. However, prescribing a cocktail of two or three new brand-name drugs, one of which is off-label, before trying the generics that are approved for the same purpose as what this cocktail is supposed to be doing? Not so much.) I don't know if the same thing is done with other illnesses, because I know a lot more about psych meds than about prescription drugs in general, but in any case there shouldn't be the assumption that New Means Better, except for those very rare cases where something is a significant breakthrough.
- Quite a lot of stupid shell games get played with "cutting expenses" that only make for more expense in the end. For example, the former situation (recently remedied by a new law) of kidney transplant patients losing coverage for the expensive anti-rejection drugs after 36 months and being unable to afford them independently, therefore leading to another instance of kidney failure. And guess what? The same plan that wouldn't cover the anti-rejection drugs after 36 months WOULD cover the MUCH more expensive ongoing dialysis, another kidney transplant, and THEN another 36 months of drugs. Lather, rinse, repeat. This is why any proposal to save money needs to be thought out as far as whether or not it actually DOES save money.
With that as background, here is approximately what I would propose if I were running things, with actual numbers possibly varying:
- A voucher system for primary care practitioners (family doctors, internal medicine doctors, OB/GYNs, pediatricians, nurse practitioners, midwives, possibly certain primary alternative practitioners if the state allows it such as naturopaths) to receive direct government reimbursement for annual physicals, well-child visits on the recommended schedule, and prenatal care on the recommended schedule. Those services should be available for the same reasons that public K-12 education, road maintenance, emergency response services, etc. should be available. These vouchers should be sufficient to pay for the actual costs of such care. (Undecided whether dental and vision should be included in this or not. Probably not the worst idea, but I realize it would add a certain degree of additional expense.)
- For other services, something similar to the flex-spending account/high deductible health plan system. Everyone has a medical account funded to, say, $6,000 annually. Individuals pay into this on a sliding-scale based on household income - they may choose to send in funds on an annual or quarterly basis (possibly as part of income tax filing) or to have it withheld from salary or other payments.
- Anything legally recognized as a health care good or service, provided by a legally-recognized health care provider, may be paid for from this account, much the way that flexible spending accounts currently work. Part 2 will have more about that.
- One of the things that is paid for from this account is a catastrophic-coverage health insurance plan. Everyone must have coverage from such a plan, and all plans sold must meet certain minimum standards in terms of coverage provided and deductible limitations. (This would be similar to how car insurance works. Certain coverage is mandatory; additional coverage is available for an additional charge if desired. There would be a default "risk pool" option for coverage that meets the basic legal requirements if the insured couldn't qualify on the regular market, much as there is for car insurance.)
- The money stays in the plan and rolls over from year to year. It is meant to be available when needed for appropriate expenses. It can be held in any federally-insured interest-bearing account in any financial institution that will accept such plans.
- If there is a circumstance in which funds from the account are exhausted but the catastrophic plan hasn't kicked in, or if the catastrophic plan gets exhausted, the next step would be a system of guaranteed medical loans much like guaranteed student loans work, with a lien against the future pay-ins to the medical account.
- One issue I can't decide is whether children to age 21 should automatically be covered without parents needing to pay in on the sliding scale, or whether they should be subject to the same requirements. I can make a good case for both options - on the one hand, kids ought to be covered regardless of their parents' financial or other mistakes; on the other hand, families that CAN afford the coverage without help SHOULD afford it. Overall, I think I would be in favor of funding the plans in full for children to age 21 until such time as the broken "federal poverty level" standards get fixed to deal with such problems as regional differences in cost of living and the fact that 3 times the monthly cost of food doesn't work as a basis for minimum living expenses. (But that's an ENTIRELY other problem.)
I know this solution isn't perfect, that there are plenty of holes in it, but I think it's the closest to getting universal coverage in place, to de-coupling employment from coverage, and to making sure that people who can afford to pay do so that I can come up with.
no subject
Date: 2010-03-21 05:41 pm (UTC)THANK YOU. This is something I tell people a lot; medical services cost lots of money, things are expensive to run, it's not that providers are money-hungry. People don't become nurses/medics/docs/PAs/PCTs/etc in order to make money. You have to actually care about people to do this sort of work.
I agree with lots of other points, here, but this is the one I had to immediately jump on and say something about.
no subject
Date: 2010-03-21 06:02 pm (UTC)1) The top amount for providers that have a sliding-scale system is an amount that very few people are actually charged, and those who are charged that amount generally CAN afford it.
2) One hour billable service time =/= one hour of work. As a rough estimate, it's reasonable to expect that one hour billable service time = somewhere between 90 minutes and two hours of work.
3) Providers have expenses other than their own take-home pay. There are payroll taxes, professional liability insurance costs (overstated in some circles but NOT nonexistent), rent/mortgage and utilities, professional licensing fees, the costs of meeting continuing education requirements, the costs of maintaining office staff, etc.
4) Insurance companies seldom if ever pay the full rate. Medicaid is particularly notorious for paying only about 66% of the full market rate for anything, which drives the market rate up higher for self-pay and people with other insurance. Even commercial insurance plans, IIRC, generally reimburse somewhere around 80-85% of the full rate.
An hour of billed time for my doctor has to cover probably somewhere around 90 minutes of his professional time, plus the appropriate wages of his nurses and his clerical staff, plus a share of the costs for contracting with an after-hours answering service, plus a share of the rent and utility costs for the office, PLUS a share of the cost of materials - everything from disposable gloves to exam tables. In addition, if the amount that insurance plans are willing to reimburse is low, there is pressure to inflate the costs beyond this to be made whole by the amount that insurance companies are willing to pay.
Oh, and those $20 co-pays? They may add up for you-the-patient, but they add up for the doctor, too, if they aren't paid!