PHYSICIANS FOR A NATIONAL HEALTH PROGRAM 29 EAST

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PHYSICIANS FOR A NATIONAL HEALTH PROGRAM 29 EAST MADISON SUITE 602 CHICAGO, IL 60602 PHYSICIANS FOR A NATIONAL HEALTH PROGRAM 29 EAST MADISON SUITE 602 CHICAGO, IL 60602 TEL: (312) 782 -6006 WWW. PNHP. ORG

The Uninsured The Uninsured

Financial Suffering Among the INSURED Financial Suffering Among the INSURED

Rising Economic Inequality Rising Economic Inequality

Persistent Racial Inequalities Persistent Racial Inequalities

Racial Disparity in Access to Kidney Transplants Racial Disparity in Access to Kidney Transplants

Rationing Amidst a Surplus of Care Rationing Amidst a Surplus of Care

Unnecessary Procedures Unnecessary Procedures

Variation in Medicare Spending: Some Regions Already Spend at Canadian Level Variation in Medicare Spending: Some Regions Already Spend at Canadian Level

Half of Americans Live Where Population Is Too Low for Competition A town’s only Half of Americans Live Where Population Is Too Low for Competition A town’s only hospital will not compete with itself Source: NEJM 1993; 328: 148

Profit-Driven HMOs: A Problem, Not a Solution Profit-Driven HMOs: A Problem, Not a Solution

Medicare HMOs: A Cautionary Tale About Competition Between Public and Private Plans (AKA Public Medicare HMOs: A Cautionary Tale About Competition Between Public and Private Plans (AKA Public Plan Option)

Despite Medicare’s Lower Overhead, Enrollment of Medicare Patients in Private Plans Has Grown Despite Medicare’s Lower Overhead, Enrollment of Medicare Patients in Private Plans Has Grown

Private Medicare Plans Have Prospered by Cherry Picking Private Medicare Plans Have Prospered by Cherry Picking

Investor-Owned Care: Inflated Costs, Inferior Quality Investor-Owned Care: Inflated Costs, Inferior Quality

For-Profit Hospitals’ Death Rates are 2% Higher Source: CMAJ 2002; 166: 1399 For-Profit Hospitals’ Death Rates are 2% Higher Source: CMAJ 2002; 166: 1399

For-Profit Hospitals Cost 19% More Source: CMAJ 2004; 170: 1817 For-Profit Hospitals Cost 19% More Source: CMAJ 2004; 170: 1817

For-Profit Dialysis Clinics’ Death Rates are 9% Higher Source: JAMA 2002; 288: 2449 For-Profit Dialysis Clinics’ Death Rates are 9% Higher Source: JAMA 2002; 288: 2449

Drug Companies’ Cost Structure Drug Companies’ Cost Structure

High Deductible Insurance: Except for the Healthy and Wealthy, It’s Unwise High Deductible Insurance: Except for the Healthy and Wealthy, It’s Unwise

Mandate Model Reform: Keeping Private Insurers In Charge Mandate Model Reform: Keeping Private Insurers In Charge

“Mandate” Model for Reform • Proposed by Richard Nixon in 1971 to block Edward “Mandate” Model for Reform • Proposed by Richard Nixon in 1971 to block Edward Kennedy’s NHI proposal

“Mandate” Model for Reform • Government uses its coercive power to make people buy “Mandate” Model for Reform • Government uses its coercive power to make people buy private insurance.

“Mandate” Model for Reform 1. Expanded Medicaid-like program § Free for poor § Subsidies “Mandate” Model for Reform 1. Expanded Medicaid-like program § Free for poor § Subsidies for low income § Buy-in without subsidy for others 2. Employer Mandate +/- Individuals 3. Managed Care / Care Management

“Mandate” Model - Problems • • Absent cost controls, expanded coverage unaffordable Computers, care “Mandate” Model - Problems • • Absent cost controls, expanded coverage unaffordable Computers, care management, prevention not shown to cut costs Adds administrative complexity and cost; retains wasteful private insurers Impeccable political logic, economic nonsense

The Massachusetts Reform: Headed Towards Failure The Massachusetts Reform: Headed Towards Failure

Massachusetts Health Reform New Coverage n < 150% Poverty - Medicaid HMO n 150% Massachusetts Health Reform New Coverage n < 150% Poverty - Medicaid HMO n 150% - 300% poverty - Partial subsidy n > 300% poverty – Buy Your Own

Massachusetts: Required Coverage (Income > $31 k) n Premium: $4, 800 Annually (56 year Massachusetts: Required Coverage (Income > $31 k) n Premium: $4, 800 Annually (56 year old) n $2000 deductible n 20% co-insurance AFTER deductible is reached

Crimes and Punishments in Massachusetts The Crime The Fine Violation of Child Labor Laws Crimes and Punishments in Massachusetts The Crime The Fine Violation of Child Labor Laws $50 Employers Failing to Partially Subsidize a Poor Health Plan for Workers Illegal Sale of Firearms, First Offense $295 Driving Under the Influence, First Offense $500 min. Domestic Assault $1000 max. Cruelty to or Malicious Killing of Animals $1000 max. Communication of a Terrorist Threat $1000 min. Being Uninsured In Massachusetts $500 max. $1068

How Many are Uninsured in Massachusetts? State and Blue Cross Surveys – 2. 6% How Many are Uninsured in Massachusetts? State and Blue Cross Surveys – 2. 6% Phone survey, few non-english speakers n Census Bureau – 5. 5% Door-to-door survey, all local languages n Mass. Department of Revenue – 5% of taxpayers, as of 1/1/2008 – based on tax returns n

Tried and Failed: State Experiments with Mandate Model and Other Incremental Reforms Tried and Failed: State Experiments with Mandate Model and Other Incremental Reforms

Massachusetts 2006 “Every uninsured citizen in Massachusetts will soon have affordable health insurance and Massachusetts 2006 “Every uninsured citizen in Massachusetts will soon have affordable health insurance and the costs of health care will be reduced. Gov. Romney. ” “The bill does what health experts say no other state has been able to do: provide a mechanism for all of its citizens to obtain health insurance. ” Sources: Wall Street Journal 4/11/06 and New York Times 4/5/06.

Massachusetts 1988 “I am very proud of the fact that Massachusetts will be the Massachusetts 1988 “I am very proud of the fact that Massachusetts will be the first state in the country to enact universal health insurance. ” Gov. Dukakis` “Massachusetts last week ventured where no state has gone before: it guaranteed health insurance for every resident. ” Sources: New York Times 4/14/88 and 4/26/88

Oregon 1992 “Today our dreams of providing effective and affordable health care to all Oregon 1992 “Today our dreams of providing effective and affordable health care to all Oregonians has come true. ” Gov. Roberts “The most far-reaching health care reform in the nation. ” Sources: Washington Post 6/9/92 and 3/20/`93

Tennessee 1992 “The most radical health care plan in America. ” “Tennessee will cover Tennessee 1992 “The most radical health care plan in America. ” “Tennessee will cover at least 95% of its citizens with health insurance by the end of 1994. ” Gov. Ned Mc. Wherter Sources: Federal & State Insurance Week 4/12/93; and NY Times 9/16/94

Vermont 1992 “This is an incredibly exciting moment that should make all Vermonters proud. Vermont 1992 “This is an incredibly exciting moment that should make all Vermonters proud. ” Gov. Dean “Governor Howard Dean, the only governor who is a doctor, signed a law here today that sets in motion a plan to give Vermont universal healthcare by 1995. ” Source: New York Times 4/12/92

Minnesota 1992/1993 “Minnesota is enacting a program that will be the most sweeping effort Minnesota 1992/1993 “Minnesota is enacting a program that will be the most sweeping effort yet to provide health insurance to people who lack it. . . the first complete reform proposal in the U. S. ” “Minnesota is about to embark on a plan to solve the healthinsurance crisis that could hold lessons for other states and the nation. ” Sources: New York Times 4/19/92; and Richard Reece, Medical World News 7/1/92.

Washington 1993 Washington state “passed one of the most aggressive health care experiments in Washington 1993 Washington state “passed one of the most aggressive health care experiments in the nation, a program that would extend medical benefits to all 5. 1 million residents of the state. . ” Source: New York Times 5/2/93

Maine 2003 “It’s bold and comprehensive, and it’s now the law of the state. Maine 2003 “It’s bold and comprehensive, and it’s now the law of the state. ” Gov. Baldacci “Maine has just become the first state in the union to approve a plan to provide universal access to affordable health insurance. ” Sources: AP Newswire 4/25/06 and Ellen Goodman, Washington Post Writers Group 7/7/03.

Public Plan Option: The Next Disappointment Public Plan Option: The Next Disappointment

In 1962 Republicans Jacob Javits and John Lindsay proposed a Public Plan Option (H. In 1962 Republicans Jacob Javits and John Lindsay proposed a Public Plan Option (H. R. 11253 and S. 2664) as an alternative to a public Medicare plan

Public Plan Option Saves Little Even if Half of Privately-Insured Switch • No savings Public Plan Option Saves Little Even if Half of Privately-Insured Switch • No savings on hospitals’ billing or internal cost tracking Ø Hospitals already use computerized uniform bill (UB-82) Ø Global budgeting could save $90 bil. annually • No savings on NH/home care bureaucracy ($24 bil. saved with single payer) • No savings on MD office bureaucracy Ø Single payer would save $85 bil. annually through simple, uniform fee schedule, eliminating prior-approval etc. • Insurance overhead reduced $38 bil. v $131 bil. under single payer Ø Private insurers retain significant market share Ø Hospital/NH payment can’t be simplified without global budgets Ø Need to collect premiums, track enrollment disenrollment etc.

Public Plan Option Cannot Solve Cost Problems • Achieves only a fraction (1/7 th) Public Plan Option Cannot Solve Cost Problems • Achieves only a fraction (1/7 th) of administrative savings possible through single payer – makes expanded coverage unaffordable • Medicare HMO experience shows private plans undermine fair competition despite regulations – avoid expensively ill • Public plan effectively serves as subsidy for private insurers, taking on many high cost patients and few profitable ones

Public Money, Private Control Public Money, Private Control

The U. S. Trails Other Nations The U. S. Trails Other Nations

Canada’s National Health Insurance Program Canada’s National Health Insurance Program

Quality of Care Slightly Better in Canada Than U. S. A Meta-Analysis of Patients Quality of Care Slightly Better in Canada Than U. S. A Meta-Analysis of Patients Treated for Same Illnesses (U. S. Studies Included Mostly Insured Patients) Source: Guyatt et al, Open Medicine, April 19, 2007

A National Health Program for the U. S. A National Health Program for the U. S.

Phony vs. Real Reform Phony • Choice of HMO/insurer • Coverage = Copays, exclusions Phony vs. Real Reform Phony • Choice of HMO/insurer • Coverage = Copays, exclusions etc. • Security = Lose it if you can’t work or can’t pay • Savings = Less care Real • Choice of doctor and hospital • Coverage = First $, Comprehensive • Security = For everyone, forever • Savings >$400 bil on bureaucracy

Public Opinion Favors Single Payer National Health Insurance Public Opinion Favors Single Payer National Health Insurance




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