Medicare and Medicaid
Happy Birthday, Medicare -- the Most Popular Kid on the Block!
Published July 30, 2009 @ 11:47PM PT
Forty-four years ago today, LBJ signed Medicare into law. At the time, 40% of the elderly did not have health insurance. A third of them also lived in poverty. Today, everyone in the country over 65 has a basic level of health security that those of us under 65 still do not enjoy. How to evaluate Medicare on its birthday? Let’s start with this – it’s worked.
The Commonwealth Fund published a study in Health Affairs which can be summed up in a single sentence, “Compared with the employer-coverage group, people in the Medicare group report fewer problems obtaining medical care, less financial hardship due to medical bills, and higher overall satisfaction with their coverage.” Make no mistake, Medicare doesn’t score perfectly. I'm positive you can find bad stories (although a colorful anecdote is never as relevant as years of hard data). In fact, 8% of beneficiaries rated their coverage “fair or poor,” but that’s a pretty good number – way better than the 18% private insurance got. The same study showed that reported problems of access to care increased from 12% in 2001 to 18% in 2007 – but private insurance in 2007 was at a shocking 45%. And, in keeping with the moral reasons for which Medicare was first founded, only 14% reported a problem paying bills – better than the 35% for private insurance, and the presumably 80-100% of the uninsured. Note that this holds true even though the Medicare patient base is, by definition, older, sicker and usually poorer than those in private insurance.
National Journal, hardly a bastion of liberal thought, comes to the same analysis in regards to Medicare’s popularity. In their analysis of data from the Consumer Assessment of Healthcare Providers and Services, they found that 56% of Medicare beneficiaries rate their coverage a 9 or 10 on a scale of 10 (only 40% for private insurance.)
More importantly, the higher scores for Medicare are based on perceptions of better access to care. More than two thirds (70 percent) of traditional Medicare enrollees say they "always" get access to needed care (appointments with specialists or other necessary tests and treatment), compared with 63 percent in Medicare managed care plans and only 51 percent of those with private insurance.
There are, of course, problems – as there are with any health care system. I’ve gone on at length in other posts about the problems with the fee-for-service reimbursement system, long-term care, and problems associated with the prescription drug plan and Medicare Advantage private HMOs. As the cost of all U.S. health care outpaces inflation, so does Medicare. Since 1970, Medicare costs have risen 8.8% per year. That’s bad, no question, and unsustainable. But over that same time frame, private insurance went up 9.9% per year. Not bad for a government-run program!
In a political climate where once again we’re being told government can’t run anything, people are responding in the most peculiar way. President Obama said at a town hall this week, “I've received letters that say, I don't want a government-run program, I don't want socialized medicine, and by the way don't touch my Medicare.” Old reliable government-run Medicare has a golden name. If you want to build on what works, you start with Medicare. Hence, single-payer health care is Medicare for All. When John Edwards and Hillary Clinton pitched their versions of the public health insurance option, they called it, “a public plan, similar to Medicare.” We’re witnessing a revolt by progressives in the House right now against the deal struck with the Blue Dog Democrats about how close the public option will get to Medicare, with a letter of protest proclaiming, “Any bill that does not provide, at a minimum, for a public option with reimbursement rates based on Medicare rates – not negotiated rates – is unacceptable.”
Of course, what’s old is new again for the opposition, as well. Ronald Reagan was the most famous opponent of Medicare’s passage, claiming, “[I]f you don’t [stop Medicare] and I don’t do it, one of these days you and I are going to spend our sunset years telling our children and our children’s children what it once was like in America when men were free.” Classic. Today’s fear-mongering pales in comparison. It’s somewhat surprising to see Republicans so desperate to stop health care reform that they’re willing to demonize and fear-monger one of the country’s most popular programs. But this week, we’re hearing from Rep. Roy Blunt (“Medicare has never done anything to make people more healthy”) and Rep. Tom Price (“nothing has had a greater negative effect on the delivery of health care than the federal government’s intrusion into medicine through Medicare”), all in the same week that conservative after conservative takes to the floor with the most recent big lie about health care reform: Rep. Foxx’s mendacious declaration that reform would “put seniors in a position of being put to death by their government.”
They ought to be ashamed of themselves – really and truly ashamed of themselves – that they’re so willing to say and do anything that they’ll bring back memories of the bad old days, when if you were old and poor there was no care for you and too many seniors had little choice other than death. The bad old days, when the number of those over 65 was half what it is now, and life expectancy over 65 was nearly 4 years shorter. The bad old days, when too many saw “illness crush and destroy the savings that they have so carefully put away over a lifetime so that they might enjoy dignity in their later years.”
As Foxx and Blunt and Price should know all too well, we finally found a way to end the nightmare conditions they warn about. We instituted a government-run program named Medicare. And that has made all the difference.
TV Could Make Health Reform Real -- Here's How
Published July 30, 2009 @ 08:47PM PT
The last presidential press conference was filled with matter on health care, but barely made a dent in the public debate. It was the lowest-rated press conference so far. What coverage it did get focused disproportionately on the last ten minutes, as Obama spoke extemporaneously about the Prof. Gates incident – an event I’ll note we still haven’t stopped talking about. All this even though Obama is erudite and articulate and talks about the future of health care in a way few others do: by pointing out that we’re really talking two health care plans on the table – one where we don’t reform, which will lead doubling of costs, more uninsured, fewer businesses with employer-based coverage, and blowing up the federal deficit; and one where we start to fix the problem, protect our people, bend costs down and make sure all reform is paid for.
It’s a good message. It’s just not resonating. So what will?
As Sen. Olympia Snowe said recently, “If anybody can give me an easy, 30-second solution to this multitrillion-dollar problem, be my guest.” But I’d say the problem isn’t trying to condense a vast and intricately confusing health care system into an easy-to-digest sound bite. You probably wouldn’t be surprised how often people ask me to explain absolutely everything that’s a problem with the current health care system and how the plan(s) in Congress would fix absolutely every problem – and do it in one page or less (and even if you would be surprised, I couldn’t tell you – I’ve lost count). But I think most people don’t actually want that. Why? Because all the information you could ever want on the problems and the proposed solutions -- and even the practical impact of reform in your neighborhood -- is only a Google search away.
Instead, I think most people want to know just enough for health reform to feel real – that there are tangible benefits for everyone. Me typing that won’t make it real. Barack Obama saying it won’t make it real. They need to see what a "better" future looks like to a real person – someone like them.
So no more press conferences, Mr. President. No more lofty rhetoric, for the moment. No attempt to mathematically prove the cost-benefit analysis. You won’t even need the truly awful individual stories of how our profit-driven health system denies care and does irreparable harm for those unlucky enough to get sick and have either the wrong insurance or no insurance at all.
You just need the East Room, a camera crew, and these four people:
Blue Dogs' Bark Worse Than Bite
Published July 29, 2009 @ 11:39PM PT
The House is back on track. The Energy and Commerce Committee began marking up HR 3200 again this afternoon and will likely finish in the next few days. At that point, all three committees will be done, their staff will work on reconciling discrepancies between the committee mark-ups, and when the House returns in September, a historic full health care reform bill will open for debate on the House floor. All it took was a deal with the Blue Dogs – self-proclaimed fiscally conservative Democrats who effectively shut down Energy and Commerce until their demands were met.
The fact that the deal was struck is a positive – the process can roll on. But most folks are worried first and foremost about what progressives in the House had to give up.
Surprisingly, not a whole heckuva lot. Irate progressive Democrats are already calling this “a sop to the insurance industry,” but the insurance reforms and regulations are intact. For those concerned that the disproportionate weight of the Blue Dogs and their pro-business tendencies would cause the House bill to be watered down, not much water was added. Probably the biggest change – and the one least expected – was that originally the federal government was going to entirely pick up the tab for increasing Medicaid eligibility to all adults at or under 133% of the federal poverty line, as well as all of the cost for increased reimbursement, particularly for primary care, of the most anemic rates in Medicaid. Now states will be asked to pay for 7% of the costs, at lest on the eligibility piece. They’ll whine. A lot. But this still leaves the federal government paying for 93% of the cost.
What now seems like ages ago, the Blue Dogs aggressively suggested they only wanted to see a public health insurance option with a “trigger” – a five year “head start” for private insurance to take advantage of all the new customers and subsidies in the Health Exchange, with a public option kicking in to keep them honest only if private insurance fails to make health insurance affordable on its own (the sound you hear is me laughing so I don’t cry.) They haven’t mentioned that in a while. Instead, they held firm for a public option that does not use Medicare rates at all, but negotiates reimbursement with its providers. It's a change. But the House public option was always going to transition away from Medicare rates and towards negotiate with providers after three years. The Senate HELP committee likewise uses provider rates from the get-go. The negotiation with the Blue Dogs just anticipated (and resolved) a likely sticking point for reconciliation between the House and Senate bills. The compromise also allows for states to set up their own co-ops. The co-ops won’t replace the public option-- they’ll just be an additional choice. No big whoop.
The element I was most nervous about was the cut in subsidies for those towards the high end of eligible income -- $43,000 for an individual and $88,000 for a family of four. But the premiums for this income level will be 12% of their income instead of the original 11%. Talk about tinkering around the edges.
As their main bragging point, the Blue Dogs pushed for small business exemption on the employer mandate to go up to payrolls with $500,000 (instead of $250,000). Really, this is moving money around – robbing Peter (subsidies on individuals) and Patrick (Medicaid money from the states) to pay Paul (small businesses). But not really paying Paul that much.
Finally, the total package will be shaved by $100 billion. I’m by nature irked by cutting money just to say you cut money, rather than actually cutting in order to make a bill better. But in this case, I just don’t see that the bill has lost anything. Negotiating with the Senate is likely to change the reform legislation by an order of magnitude more than anything we’ve seen from negotiating with the Blue Dogs, for all of their barking.
That’s why I agree with the dominant sentiment – this was about stalling for time. It’s basically impossible for a House vote before the recess at this point (so Henry Waxman and House leadership agreeing to delay a vote until September is a “no duh”). Hopefully, the Senate Finance Committee – who has an extra week before recess – has a reasonable chance of getting their act together (defined solely as finally producing a draft bill, in this case). As Jon Cohn writes, “[Blue Dogs] want to wait and see what the Senate produces. If they have to take what they consider a hard vote--to raise somebody's taxes, to change the way Medicare pays for medical services, whatever--they don't want to stick their necks out any more than is absolutely necessary.”
That’s why the Blue Dogs bit off so little of what makes HR 3200 work. Once the vote was delayed, the rest was gravy anyway.
(Photo credit: eepie on Flickr.)
What Reform Looks Like in Your Neighborhood
Published July 27, 2009 @ 01:08PM PT
Folks, Henry Waxman ain’t playing.
Today, the entire Democratic delegation is meeting for 5 hours on HR 3200, the America’s Affordable Health Choices Act. This is less a negotiating session and more a seminar on what’s in the bill and how it would help. As preparation for this caucus meeting, Waxman’s staff on the House Energy and Commerce Committee – the last committee that reform legislation needs to pass through before it reaches the House floor -- has basically unleashed policy wonk hell upon unsuspecting legislators.
In an interview with Bill Clinton, Marc Ambinder wrote: “Lost in the debate about how much health care reform will cost, Clinton said, is the debate about whether the reforms will work.” Consider that debate snapped back into focus, at least for the Democrats. The committee has released a Congressional district by Congressional district breakdown of the estimated impact of HR 3200. You can look up your district here. Calculated for each and every CD is a breakdown of the number of small businesses that would be helped, the number of seniors who would be helped, the number of bankruptcies to be avoided, the amount of additional money local health care providers would receive, and the number of uninsured who would be uninsured no more. The data cited comes from the Gallup-Healthways survey on the uninsured, the Census, the Centers for Medicare and Medicaid Services, and Ways and Means.
I’m relatively sure I had the same impulse as most people will – I looked up my home district (NY-8) first. It begins with a bang:
…up to 26,200 small businesses could receive tax credits to provide coverage to their employees; 7,100 seniors would avoid the donut hole in Medicare Part D; 430 families could escape bankruptcy each year due to unaffordable health care costs; health care providers would receive payment for $135 million in uncompensated care each year; and 35,000 uninsured individuals would gain access to high-quality, affordable health insurance.
Not bad. Then I decided to get a little mischievous. Mike Ross (AR-4) is both the leader of the Blue Dogs and one of the Democrats dragging his feet on health care reform within Energy and Commerce. How, I wonder, would he like to explain passing up the following?
…up to 12,500 small businesses could receive tax credits to provide coverage to their employees; 6,700 seniors would avoid the donut hole in Medicare Part D; 1,500 families could escape bankruptcy each year due to unaffordable health care costs; health care providers would receive payment for $155 million in uncompensated care each year; and 124,000 uninsured individuals would gain access to high-quality, affordable health insurance.
Numbers like these really crystallize the biggest “Go figure!” aspect of this debate. My Congressman is Jerry Nadler. He’s not only pro-reform, but he’s openly said he’d vote against a health care reform bill that didn’t at least contain the public health insurance option (he’s also a co-sponsor of HR 676). Mike Ross has been publicly feuding with Waxman on trimming back reform. But far more people in Ross’s district would benefit from reform than in Nadler’s district.
There’s a clear political overtone here. If the House vote doesn’t happen before recess, nervous Democrats can now return to their districts and be able to answer how reform helps their constituents with confidence. More to the point, it’s easy to see these numbers being cited in letters to constituents – and future campaign mailers – if and only if health care reform passes.
They'd look just as nice in a mailer from an electoral opponent if health care reform fails... and you voted against it.
(Photo credit: House Education and Labor Committee on Flickr.)
CBO Misses the Mark on IMAC
Published July 25, 2009 @ 10:32PM PT
Let’s just say I’m not in a rush to have Doug Elmendorf pick my fantasy baseball team next year.
Earlier today, the Congressional Budget Office released an estimate on the proposal to make the Medicare Payment Advisory Committee an independent body (IMAC) capable of setting policy with regards to saving costs in Medicare. The CBO’s somewhat impossible job is to predict future costs and savings based on legislation that’s in process. They’re seen as the umpire – when they call it a ball, it’s a ball; when they call it a strike, it’s a strike. But you know what – sometimes the ump blows a call.
Every year, MedPAC releases a report that makes recommendations on what should be done with Medicare payment rates to lower costs and improve quality. Because of the political process, every year those recommendations go unfounded. Here’s the thing, though – we have MedPAC recommendations on file going back over eleven years, including whether the few recommendations that were implemented actually saved money. But the CBO didn’t base its analysis on what MedPAC has proposed in the past to speculate on what kind of savings could be proposed in the future. Instead, it’s based on – uh, you know, I have no idea. There’s lots of questions about who gets to be on the board and how susceptible they’d be to political pressure from the President or the industry. There’s speculation that if the board is mostly doctors, they won’t want to mess around with physician payment rates. Somehow, all of this will translate to meager to no savings.
And I can’t quite shake the feeling I’m reading an analysis written in 2007 of what health care spending will look like in Hillary Clinton’s second term as President.
The CBO is attempting to determine what additional savings will be recommended by a board whose composition CBO cannot predict making determinations CBO cannot predict based on future circumstances that CBO also cannot predict. They’re also trying to determine the chance that those recommendations will be passed along by a future President (whose identity is unknown) and whether those recommendations will be stopped by a future Congress whose composition is unknown. It’s one thing to say the chances of short-term savings is small, and the chances for long-term savings “could eventually achieve annual savings equal to several percent of Medicare spending.” It’s another thing to actually assign that a numeric value. Based on what, exactly? The CBO letter gives no indication – no charts, no graphs, no proposals.
I’m totally with the CBO when it puts forth an unfavorable score, even to a proposal I like, when it shows the economic modeling behind it. Of late, I often don’t like their end results – discounting savings for anything that’s outside their half-dozen proposals for savings, like instituting an automatic cap on Medicare spending. But I at least respect how they came to their conclusions. This I can’t respect. This is pretty much the CBO coming with a number and justifying it by predicting future interpersonal relationships.
You know who else noticed? White House OMB Director Peter Orszag, himself a former CBO director, who wrote of this analysis: “it is also the case that (for good reason) CBO has restricted itself to qualitative, not quantitative, analyses of long-term effects from legislative proposals. In providing a quantitative estimate of long-term effects without any analytical basis for doing so, CBO seems to have overstepped.”
Um… you think?
Update: 07/26/09 at 8:05 pm PT -- For more on this topic, read GoozNews, "CBO Fears Providers Will Control 'MedPAC on Steroids'"
(Photo credit: Seabamirum on Flickr.)
Cutting Health Care Costs at Gunpoint
Published July 22, 2009 @ 07:21PM PT
Much has been made this week of whether or not we’re “rushing” by enacting health care reform along the lines of what President Obama first proposed in May of 2007. All indications are that health care legislation won’t be passed out of both the House and the Senate by the time of the August recess. The impression you get is though we had all the time of the world. In addition to the real-time impact on families and businesses, state governments also don’t have time to wait. Since they’re required to balance the state budget, and health care is either #1 or #2 in terms of percentage of state spending, they have no choice but to deal with skyrocketing costs, figuratively, at gunpoint.
Of course, how they do so is as idiosyncratic as the states themselves. Some look upon their budget situation as crisis – others as opportunity.
California, of course, is pure crisis – and it’s a terrifying crisis at that. As fellow Change.org’er Leigh Graham wrote on Poverty in America, “The more I read, the worse it gets.” Already in July, enrollees on Medi-Cal lost a chunk of their benefits entirely, including dental, optical, mental health (psychology) and speech therapy. It’s not that those on Medicaid will cease needing eyeglasses, therapy or care for gum infections – they’ll just have to go without. Healthy Families, the California CHIP program, froze its enrollment to low-income children about a week in advance of the budget deal. Schwarzenegger had threatened to discontinue the program altogether, making California the only state in the union not to have a coverage program for low-income children outside of Medicaid. In the end, the program was spared, though the $144 million cut to the program guarantees not just that 350,000 children will be placed on a waiting list, but that some already on the program will likely have to be kicked out -- possibly as many as 250,000.
California is an extreme example, but the behavior is not extreme. Most state legislatures and governors react to lean times by cutting benefits, trimming programs, and lowering eligibility. Gov. Schwarzenegger’s actions seem shocking, but they’re not too far removed from Gov. Breseden in Tennessee reacted to a previous budget crisis by “rolling back” Medicaid eligibility for 100,000 people. And it’s not just Medicaid. Massachusetts, finding it could not afford the full costs of its subsidized Commonwealth Care program which enables low-income residents to buy insurance, will yank coverage from 30,000 legal immigrants – those who are in this country legally, played by their rules, have their papers and did everything right. They just can’t afford to pay 25% or more of their income on insurance.
The news isn’t all bad, of course. As mentioned, Massachusetts is using the current economic situation to finally do something about skyrocketing costs by moving away from fee-for-service and towards a payment system that rewards quality over quantity. While California is cutting health coverage for children that will likely kick 250,000 off the program, 13 states recognize that the safety net provided by CHIP programs is more important than ever and have increased eligibility by an aggregate 250,000. And the Sustinet program in Connecticut, despite being vetoed by Gov. Rell for the second year in a row, finally broke through when the Connecticut Legislature overrode the veto. Universal, affordable coverage through a state-level government option that operates on the cost-effective medical home model could be alive and kicking in Connecticut by 2012.
It’s possible some of these breakthroughs would have happened without an economic crisis. But certainly a powerful impetus came from the immediacy of need for more and more citizens, combined with the need from the states to get more bang for their health care buck. While legislators at the federal level complain about the haste of a summer time line, the possibility of making a tough vote isn't real pressure. Real pressure is working at the state level, having no options to delay, and being forced to fix a problem that's national in scope.
(Photo credit: Thomas Hawk on Flickr.)
Orszag: This Looks Like a Job for MedPAC
Published July 18, 2009 @ 12:03AM PT
The kerfluffle over Congressional Budget Office Director Elmendorf’s comments about whether the health care bills in front of him would do enough to bend the curve of our overall trajectory of sky-rocketing costs may have been news to some, but it’s old hat to White House OMB Director Peter Orszag. After all, it used to be him, as CBO Director, making the presentations and the charts showing how the alarming rise in overall health care costs was threatening our fiscal house. As such, he took today to mention a proposal that would serve to dramatically cut costs both now and ongoing – changing the process to give the recommendations of the non-partisan Medicare Payment Advisory Committee real weight.
I’ve mentioned this White House proposal before. MedPAC, a body that was created in a bipartisan fashion by the Gingrich House and the Clinton White House, issues two reports a year on ways to revise Medicare to make the system better and more cost-efficient. As I wrote back when it was first proposed, “right now the reports are completely advisory. Meaning if they advise difficult choices to dramatically control costs and improve care – as they usually do – they can be easily ignored.” Their most recent report was insightful, creative, and balanced with ideas that would both cut costs and improve quality. But I also noted “none of them have, to date, survived resistance from the lobbyists of the various industries.”
Orszag, in a letter to Congressional leaders as well as a post on the OMB blog, takes the opportunity to point out, in essence, “Yo, I got your cost control right here”:
There are a number of steps that can be taken to bend the curve – health IT, investing in research into what works and what doesn’t, and changing incentives so that doctors and hospitals give you better care not just more care. But one of the most potent reforms is a change in the process of health care policymaking: empowering an independent, non-partisan body of doctors and other health experts to make recommendation about Medicare payment rates and other reforms.
In many ways, the current debate in Congress proves the point. The strongest parts of the House bill’s cost-cutting measures are “safe” ideas, like cutting overpayment to Medicare Advantage, that MedPAC has been advocating years. Much bolder ideas, like cutting reimbursement for physicians who self-refer on imaging scans, are in MedPAC’s recommendations, but didn’t make it into the batch of savings designed to pay for reform, despite being an easy if politically tenuous proposal. So the White House would create a process whereby MedPAC’s ideas become more than just a report that sits on a shelf, gathering dust. Like the base closing commissions, the President could choose to submit all of MedPAC’s recommendations as a package deal. Congress would have 30 days to intervene, but they couldn’t pick and choose what proposals they’d like – they could only vote up or down on the whole package. As Orszag diplomatically puts it, this “would free Congress from the burdens of dealing with highly technical issues such as Medicare reimbursement rates while rightly giving them, your representatives, a say in the matter. Moreover, this kind of body would enable the health care system to respond to a very dynamic market and technical landscape, making Medicare policy more responsive and effective in the future.”
As I’ve said before, it’s not that we don’t have great ideas to dramatically lower costs. We just don’t have the political will to implement them. If people really cared about Elmendorf’s statements and about bending the curve of health care costs, they would support the non-partisan MedPAC recommendations all the way.
But pardon me if I don’t hold my breath.
(Photo credit: The National Academy of Sciences on Flickr.)
