Jennifer Marion's Blog

Downsizing . . . and shortages?

Jennifer from Washington, DC — Tue, 08 Apr 2008 23:26:48 EDT

I think Jon is absolutely correct to flag the likely downsizing of the health care system as an unintended consequence of reform. It's yet another argument for why the next president will have to reverse the current administration's pattern of cutting the federal job training budget – but that's another story.

So on the one hand there will probably be downsizing in certain sectors of the health care system but, on the other, we may also be looking at some shortages. For example, as this article from the Times points out, people in Massachusetts are facing long delays before seeing general practitioners. Some of the problem is a part of a larger trend; nationally, particularly in rural and many urban areas, there is a widening gap between the number of general practitioners and the need for their services. But the situation is exacerbated in Massachusetts, where you suddenly have a large number of newly-insured people who are looking to make appointments with doctors when they previously would have gone to the emergency room or just forgone treatment altogether.

Once we have health care reform, any shortage of general practitioners/primary care providers is likely to become a bigger problem. It would be a tragic irony to trade a system where people can get in to see their doctor relatively easily (at least in part) because so many cannot afford health care for one where everyone can afford health care but no one can get in to see a doctor. The Times article touches on a few possible solutions: recruiting more foreign medical school graduates, student loan forgiveness for those who go work in underserved areas, and altering the reimbursement scheme for primary care providers. What are some other possibilities? Perhaps we could take some of the resources that are freed up as a result of having a more efficient system and reinvest in programs that would make sure there are enough primary care providers?

Oh, and speaking of job training programs, also noted in the Times is President Bush's proposal to eliminate $48 million in federal support for primary care training programs . . . .

Garden State health care reform

Jennifer from Washington, DC — Thu, 20 Mar 2008 01:25:11 EDT

In previous posts, we have noted the ways in which several states, in the absence of a federal solution, have tried to fix the problem that is our broken health care system. We can add another to that list: a bipartisan group of legislators have unveiled a proposal that would make New Jersey the fourth state to provide some form of universal health coverage. Under the plan, the state would work on cutting costs and establish a self-financed, state-run plan that would provide individuals with coverage at affordable costs on a sliding scale depending on income. There would be an individual mandate but, unlike Massachusetts (which requires individuals to purchase the insurance on the private market), New Jersey would require its residents to purchase insurance from a single, state-administered plan.

As noted in the Times' article, reaction has been mixed. Groups representing employers and health care providers indicate approval because of the plan's proposal to lower costs. Union and consumer groups, however, expressed concern with the plan's underlying proposal to shift costs from a shared responsibility between employers and employees to one between consumers and taxpayers, which could cause employers to drop their health care plans.

I think both groups have it right: clearly, lowering the cost of coverage has to be a top priority of any health care reform. But I'm not sure if that will make as much of a difference in a system that from the beginning eliminates employer involvement. If employers were to dump their health care plans in response to the availability of the state-run plan, the result could be a (possibly significant) gap in coverage – at least initially.

This also raises a broader question: if we were to have a single, state-run plan (or, possibly, any well-regulated private market system) that has lowered costs so that they are affordable or subsidized for all, should employers still be a part of the equation? What do you think?

Health care reform and the intertubes

Jennifer from Washington, DC — Thu, 14 Feb 2008 21:46:02 EST

One of the things I like to do when trying to stay abreast of health care reform-related news is keep my eye on what the health care bloggers are saying. The internet is a treasure trove of serious and informed discussions on health care issues and health care reform. A great source for discovering new (and old) health care blogs is the Health Wonk Review: every two weeks, a different health care blogger "hosts" the Review by receiving submissions from various health care bloggers and culling through them to find the best-of-the-best posts for that period.

The last Review, hosted by Doug Williams of Health Business Blog, was chock full o' postings on health care reform. Over at the Health Care Blog, for example, Jeff Goldsmith writes that all of the political discussion about health care reform is focused only on two of our health care "systems" – public and private financing systems – but does not address the third system, the public care system (such as safety net urban hospitals and community care centers). Of course, there are two interesting posts making arguments for and against the health care reform topic du jour – mandates. And, just for a change of pace, Michael Millenson writes at Health Affairs blog that "Huckabee seems to be saying that fixing American health care is as simple as getting smokers to put their butts down and fat people to pick theirs up."

So, have you read any interesting postings out there on reform? Also, do you think there is any way to use these well-informed blogs and bloggers to push for or help achieve health care reform?

Wal-Mart increases enrollment in its health care plan

Jennifer from Washington, DC — Fri, 25 Jan 2008 11:35:47 EST

Wal-Mart reported this week that, for the first time in the company's history, more than 50% of its employees had enrolled in the company's health insurance plan. This is up from about 45% of its employees five years ago, and it means that Wal-Mart now insures significantly more of its employees than Target, which insures 40% of its workforce. Wal-Mart was able to increase enrollment by offering a wider range of premium/deductible combinations, allowing people to enroll after one year of employment (as opposed to two), and eliminating certain fees. Now, 92.7% of Wal-Mart's workforce has health insurance either through the company, a spouse's plan, Medicaid, or some other source.

I am not a big fan of Wal-Mart because of its various, well-reported labor practices. I am willing to admit, however, that this is a step in the right direction. Of course, as pointed out in the linked-to article above, 7.3% of Wal-Mart's workforce still thinks it is better to have no insurance than to enroll in Wal-Mart's plan. This might be in part because some of the plans with low premiums have deductibles as high as $2000 for an individual – this equals 10% of the average Wal-Mart employee's $20,000 annual earnings. Still, a step in the right direction is always a good thing, as long as the company keeps working to increase participation.

The question is whether there is anything we can learn from what Wal-Mart has done. What do you think?

National health care spending hits $2 trillion

Jennifer from Washington, DC — Mon, 14 Jan 2008 20:49:52 EST

As discussed in this Times article, national health care spending exceeded $2 trillion for the first time in 2006, which is nearly double what it was a decade ago. The main point of the article, and as discussed elsewhere, is that much of the increased spending is due to the advent of the Medicare drug benefit, which has impacted spending throughout the entire health care system.

Two smaller points, though, deserve mention: first, data shows that spending on hospitals, doctors, and nursing homes grew at a slower rate in 2006 than it did in 2005, but that spending on administrative costs increased at a greater rate – almost twice as fast. "One reason [for this] is that private insurance companies have a larger role in Medicare, and they typically have higher administrative costs than the traditional fee-for-service Medicare program, federal health economists said."

Second, Medicare’s share of drug spending soared from 2 percent in 2005 to 18 percent in 2006, while Medicaid's share fell from 19 percent to 9 percent in the same period; this is because drug costs for six million people shifted from Medicaid to Medicare. As noted by the article, "[p]rivate insurers, which manage the drug benefit for Medicare, negotiate discounts with pharmaceutical companies. The discounts were generally smaller than those provided under Medicaid, the report said."

I call attention to these two smaller points because they implicate what tends to be a broader argument against health care reform that includes greater government participation: that the private market will be better at keeping health care costs and spending down. On at least a superficial level, these points appear to provide some evidence against that argument.

Breaking news: health coverage improves the health of the uninsured!

Jennifer from Washington, DC — Thu, 03 Jan 2008 17:44:54 EST

The Times has an article from yesterday about a recent study demonstrating that, for the uninsured who are 55 years or older, Medicare significantly reduces their risk of declining health after they enroll at the age of 65.

This is one of those things that seems kind of obvious but, when thinking about it in terms of the broader health care reform debate, it's implications are huge. If there is such success at staving off poor health after the uninsured person turns 65 (e.g., as noted by the article, "[u]ninsured people with heart disease and diabetes radically cut their expected rate of decline, to a point where they were almost as healthy at 72 as they were at 65"), imagine what could happen if coverage were extended to everyone? Although the article does not get into this, intuitively it would seem that the costs associated with reducing the risk of declining health would rise in accordance with the rising age of the uninsured individual.

Also from the article: “

Our findings provide some of the strongest evidence yet that expanding health coverage to the uninsured improves their health,” said Dr. J. Michael McWilliams, the paper’s lead author and a research associate at Harvard, particularly older people with “conditions like hypertension, diabetes and heart disease, for which there are effective therapies.”

This seems obvious but, for some, I guess it hasn't been. Food for thought as we enter a new year. Let's hope that, as 2008 comes to a close, real health care reform is just around the bend.

Reducing health care costs

Jennifer from Washington, DC — Fri, 21 Dec 2007 13:18:19 EST

This past week, the Commonwealth Fund, a prominent health care “think tank,” issued a report looking at 15 ways that the federal government could reduce national health care spending by as much as $1.5 trillion over 10 years. A lot of the suggestions are focused on reducing Medicare costs, but would have broader impact if implemented as part of any health care reform. As noted by an editorial in yesterday’s NY Times, the report does not look at the savings that might be generated by expanding Medicare into a program that would replace private insurance. You can read the full report here, but the policy options that would result in cost-savings are:

1) Producing and using better information: promoting health information technology, creating a “Center for Medical Effectiveness and Health Care Decision-Making,” and requiring providers to educate patients about alternative treatment options.

2) Promoting health and disease prevention: reducing tobacco use and obesity, and using federal funds and incentives to encourage individuals to engage in wellness programs and healthy behavior, and to cover preventive services.

3) Aligning incentives with quality and efficiency: establishing a hospital pay-for-performance program, transforming the fee-for-service payment system to an episode-of-care system, strengthening primary care and care coordination, and limiting federal tax exemptions for premium contributions.

4) Correcting price signals in the health care market: reset benchmark rates for Medicare Advantage plans, establish competitive bidding among Medicare plans, give the federal government the authority to negotiate prescription drug prices for Medicare plans, and limiting payment rate updates in high-cost areas.

As an interesting aside, one of the Fund’s suggestions for reducing obesity is to establish a nominal tax on sugar-sweetened soft drinks to help finance national and state obesity-prevention programs. The Mayor of San Francisco just proposed something similar, a surcharge for large stores when they sell sugar-sweetened sodas, for his city.

So, what do you think of the Fund's suggestions? What are some other ways to reduce the nation's health care spending?

To mandate or not to mandate: is that really the question?

Jennifer from Washington, DC — Thu, 06 Dec 2007 01:18:02 EST

One of the hottest health care reform topics in the blogosphere and the opinion pages recently has been the issue of "individual mandates." All of the top three candidates, Barack, Hillary Clinton, and John Edwards, have proposed health care reform plans that would be a wholesale change from the system we currently have. There are differences, though, between their plans, and one of those is whether there should be an individual mandate – in other words, whether individuals should be required or forced to purchase insurance from private insurers. The three candidates have different approaches to this question. To summarize, John Edwards's health plan would have a mandate that he would enforce through collection agencies and wage garnishment. Hillary Clinton's plan would have a mandate, but she has not yet explained how it would be enforced. Barack's plan has a mandate to require that children be insured, but uses other mechanisms (as discussed in Robert Reich's post that Jon linked to the other day) to ensure that everyone will be covered, and would revisit the possibility of a mandate for adults later if necessary.

This difference between the candidates' on individual mandates for adults has resulted in differences of opinion on several fronts, including: whether individual mandates are the best way to get as many people as possible covered (as opposed to, say, lowering health care costs to make insurance more affordable); whether mandates are actually enforceable; whose plan will cover the most people; and whether a mandate is even politically viable.

So, what do you think about mandates? Do you think they are good/bad, necessary/unnecessary? Is the "mandate issue" important, or much ado about nothing?

Update: more on medical tourism

Jennifer from Washington, DC — Mon, 03 Dec 2007 21:59:11 EST

A little over a month ago, I wrote a post about medical tourism and how some in the health care industry are predicting that, within the next few years, U.S. health insurers will cover trips overseas for non-emergency surgeries. Thailand, specifically Bumrungrad Hospital in Bangkok, was mentioned frequently in the linked articles in that post as a popular medical tourism destination for Americans. Bumrungrad is, after all, a private downtown hospital, with a sushi bar, interpreters, and VIP suites with marble bathrooms.

One of the articles noted the difference in medical care received by tourists compared to Thais. NPR has an interesting article that ties the two together: due to how much money Thai doctors can make at private hospitals like Bumrungrad, few are willing to work at public hospitals, which serve the majority of Thais. As a result, Thais are having a hard time finding a doctor and getting medical treatment. As NPR notes, though, Thailand has already had a doctor shortage. Many Thai doctors left to join the U.S. military during the Vietnam War and, more recently, moved to other countries in order to make more money. The pay difference between private and public hospitals is just continuing the problem. Still, this is a reminder that an influx of "medical tourists" from America and Europe could have unintended and very negative consequences for the locals.

The article also contains an earlier Q & A on what to look for if you are thinking of traveling overseas for medical care. You can also listen to a bit of the author's interviews that led to the story.

The rising costs of health care

Jennifer from Washington, DC — Thu, 29 Nov 2007 00:09:47 EST

Over the weekend, there was a very interesting editorial in the Times that takes a broad look at the rising costs of health care in this country. The effects of high costs are somewhat obvious:

Workers complain that they cannot afford high premiums for health insurance. Patients forgo recommended care rather than pay the out-of-pocket costs. Employers are cutting back or eliminating health benefits, forcing millions more people into the ranks of the uninsured. And state and federal governments strain to meet the expanding costs of public programs like Medicaid and Medicare.

As noted in the editorial, controlling costs is important because, if health care costs continue to rise as they have been, eventually "every penny of the annual increase in gross domestic product would have to go for health care." The editorial begins to offer solutions for controlling costs, including preventive care, managed care, disease management, and making better use of information technologies. It also discusses other saving mechanisms, such as paying providers less and/or emphasizing primary care, as well as possible system-wide changes such as moving to a consumer-driven model (where people pay more for health care, and are given more information about doctors and treatments, so that they think harder and make wiser decisions about health care) or a single-payer system.

The editorial is really just a jumping off point for a very important aspect of health care reform: how should we reduce and control health care costs? What should we prioritize?

'Tis the season . . . to check your prescription drug coverage!

Jennifer from Washington, DC — Mon, 19 Nov 2007 01:20:47 EST

For the folks out there who are age 65 or older (or who have friends or family members that fit the bill), you've probably heard that the open enrollment period for Medicare Part D began on November 15, and lasts until December 31. For those who don't know what Medicare Part D is, it's the Medicare prescription drug benefit that went into effect on January 1, 2006. To receive the benefit, individuals enroll in a participating stand-alone prescription drug plan from a private health insurance company. The plans are regulated by Medicare, but unlike Medicare Parts A (Hospital Insurance) and B (Medical Insurance), aren't standardized. This means that different plans cover different drugs, have different price tiers for different drugs, etc.

To say choosing a plan is confusing would be an understatement. In Minnesota, for example, Part D beneficiaries will get to choose between a mere 151 plans! Investigating whether to stick with your current plan is important, though: as noted here and here, premiums for a lot of plans are going up this year. Other plans may be changing their coverage. There are resources on the web that offer advice on choosing a plan, including the official government site that lets you compare plans and what drugs they cover side-by-side. Some pharmacies are also going to help beneficiaries figure out which plans best serve their needs.

As noted in at least one of the above linked articles, Part D was controversial when it was passed as part of 2003's Medicare overhaul. Health Affairs, an influence health policy journal, has an interesting blog piece here examining renewed calls for a Medicare-run prescription drug plan.

So, as it is about to enter its third year of existence, what has your experience been with Part D? What has worked for you, what needs changing?

Carrots or sticks?

Jennifer from Washington, DC — Sun, 04 Nov 2007 23:06:51 EST

It is understandable that employers would want to cut costs associated with their employees' health care. But, in their effort to do so, to what extent should employers dictate or influence their employees' behavior?

This NY Times article discusses the recent trend of employers paying for "corporate wellness programs" to help employees quit smoking and lose weight.. Some even go as far as to provide monetary awards for employees who succeed. This can provide employers with big savings (compare the $900 in smoking cessation costs with the estimated $16,000 in additional medical bills the average smoker accrues over a lifetime). Plus, no one can deny that offering these programs provides a great benefit to employees.

Some employers go the opposite route: they penalize employees who engage in unhealthy behaviors like smoking, such as by charging them higher premiums or deducting small amounts from their pay. Some employers have even gone as far as firing smokers. A recent Wall Street Journal poll, however, does not find much support for these more punishing approaches. Only approximately one-third of the people polled think it is fair that employees who engage in "unhealthy lifestyles" pay higher premiums or deductibles, while there was barely any support for firing employees who smoke or are seriously overweight.

What do you think? Should employers be able to require higher premiums for employees who do not make healthy choices? Should they be able to require participation in wellness programs? Or should it be the employees' choice?

How about combining that knee replacement with a trip to Thailand?

Jennifer from Washington, DC — Sun, 28 Oct 2007 18:49:54 EDT

When I lived in San Diego, I had a few friends who would head south to Mexico for routine visits to the doctor and the dentist. I never tried it, but these friends swore that this much cheaper option, known as "medical tourism," was the way to go. It seems that some in the health care industry agree. In a recently released "white paper," David E. Williams and John Seus predict that, in an effort to control costs, U.S. health insurers will begin to cover medical tourism for non-emergency care in 2008, and that state governments will "embrace" medical tourism by 2010. They note that Blue Cross Blue Shield of South Carolina has already added a hospital in Thailand to its network and started Companion Global Healthcare to assist other health plans with establishing overseas networks. Given that an estimated "hundreds of thousands" of Americans now leave the U.S. for less expensive health care, it is no wonder insurers are considering their options.

Clearly, medical tourism raises quality-of-care concerns. While many attest to great experiences with both the treatment received and customer service, there have been plenty of horror stories of botched surgeries. Even if quality-of-care could be assured (such as by the Joint Commission International, which inspects overseas hospitals and analyzes whether they meet American standards of care), the possibility that health insurers could routinely offer medical tourism as an option raises a number of flags. Will patients be pressured to travel overseas for care as a cost-saving measure for employers and insurers? Will the costs for family members to travel with the patient be included in the coverage? Is a return trip necessary if complications should arise after the patient has returned, or will the patient be able to receive treatment here? What recourses will patients have if the treatment received ends up being sub-standard?

So, what do you think about traveling to another country for medical care?