My take on the interview is that I seriously believe Conrad's entire knowledge of health care comes from his time being lectured on the vagaries of Medicare reimbursement by a local rural hospital lobbyist, his one visit to a co-op seed store where he found the farmers chatting happily, and his reading the cliff notes (prepared by his staff) of TR Reid's good but not too sophisticated book focusing on the Beveridge v Bismarck distinction—which is high school civics lesson stuff.
Yet he gets to meet 61 times with the Gang of six that was really going to get it all right before time ran out, and he gets to make policy!
And you wonder why the Senate should be abolished.
This is much more fun and better sung than traditional protests! And given that AHIP would benefit from a public option, I suspect Karen Ignagni hired them. It looks like it happened in the closing session of this AHIP conference on Friday although having sat in many of these conferences I do need to tell the protestors that no plotting is done in these Forums. That happens elsewhere…
I've been so buried in the run up to Health 2.0 that I haven’t had a chance to add to the deluge of electrons about the bills in Congress, Obama’s speech, the several hundred amendments to Baucus’ bill in mark-up, etc, etc. And my colleagues on THCB and elsewhere are taking good care of you in the details.
But I thought that I’d quickly respond to today’s WaPo article in which Erza Klein connects two themes that matter, while leaving out two that matter more. The first of the two he identifies is that most Americans don’t see the cost of health care. If we made them all write a check for $13,000 a year, and they’d seen that number go from $8,000 a decade ago and realized that it will be $25,000 in another decade, then the cost problem would be much more real. It would also get associated with the access problem as people realize that as the cost goes up, they (and their employer) can afford less. At the moment those problems are disconnected.
The ignorance here remains palpable. An HR exec I know did an exit
interview last week with an employee who was astonished to find out
that now he was on his own he could buy family health insurance in
California for under $500 a month which was less than his contribution
to the company plan. The concepts of risk pooling, risk selection,
varying benefit levels et al were clearly foreign to him. And of course
had his family had a pre-existing condition that policy might have cost $3,000 a month or more.
TR Reid is a former foreign correspondent with the Washington Post. He spent two years (partly funded by the Kaiser Family Foundation) looking at health care systems across the world and has been featured heavily in many media venues lately asking the simple question, if everywhere else can cover everyone at half the cost, how do they do it? I had a great and not too long interview with him last week.
Seniors care about death panels (apparently) but they usually really care about drug prices and costs. Part of the political rationale for the Republicans passing Medicare drug coverage in 2003 was to deny the Democrats the ability to bundle seniors’ desire for drug coverage with a universal coverage bill. So far the Republicans have to say the least muddied the waters as to whether universal coverage is a good thing for Medicare recipients—or at least the ones that don’t care about their kids or grand-kids.
But there’s one minor trick. The deal with big Pharma that’s part of HR 3200 cuts the donut hole in half. That’s real money for seniors.
In that case, knowing that there is something in the bill that helps them might change some seniors’ minds. Right now the Silverlink/Suffolk poll does not make happy reading for the Administration:
The survey also polled Medicare recipients on healthcare reform. Despite high levels of satisfaction and relatively strong amounts of optimism, nearly half of Medicare recipients polled (48%) say they do not believe the Obama administration is looking out for their best interests when it comes to healthcare reform. The remaining are split, with 28% believing the administration is looking out for them and 24% unsure.
I’ve been meaning for a while to put up a common sense post that points out that if we don’t do reform now, we’ll end up with cost at close to $30K per family as opposed to the $15K as they are now, and in turn that will mean 80–100 million uninsured as opposed to 50–60 million we have now, and of course the end result will be a health care industry that looks like General Motors.
Which just leads to one conclusion. The health care industry had better buckle down with the Blue Dogs, put more on the table, and get something passed that they can live with now. AND in addition, they need to figure out some way to stop the loony fringe at the town halls and listening to Rush Limbaugh from making the next best alternative be doing nothing—which is what they want.
Otherwise the conversation they’ll be having with the President and the Chinese central bank in 2016 will be very, very unpleasant.
The idea of establishing regional cooperatives, advanced as an alternative to President Obama’s public plan option, has attracted attention as a means of assuring that health reform legislation contains some means to improve competition among health plans around the nation. But the proposal, which may have superficial appeal as a “middle ground” between a public plan option and an unchecked private market, is ill-equipped to fix the key problems a public plan would address. In addition, recent experience teaches that timely and effective entry by such plans is unlikely.
The first issue is whether a cooperative, organized by consumers or other groups, can effectively deal with the shortcomings of the existing delivery system and insurance market. Thus far, the proposal advanced by Senator Conrad is pretty sketchy, but are grounds for skepticism. A central reason for having government sponsored plans is to allow the efficiencies of Medicare’s well-established administrative structure and innovative payment experiments to carry over to the private sector. Coops provide no such advantage. A second advantage of public plans is that they would likely achieve some bargaining leverage by virtue of their probable role as insurer for people representing higher risks whom private insurers find some methods to avoid. Hospitals and physicians will be hard pressed to bypass such a significant presence in the market and the public plan can thereby exert market-wide pressure to keep provider and pharmaceutical costs down. Whether co-ops will be willing to undertake the role of covering such individuals or able to sponsor innovative delivery systems to treat them is far from certain.
In any event, it is hard to envision numerous regional coops gathering the necessary data, experience and reputation to serve as a benchmark or counterweight to dominant hospitals and provider groups across the country. Further, there is a serious question regarding the independence and mission of coops. It is a mistake to assume that nonprofit entities will necessarily work to the advantage of the public. Unfortunately, our experience with nonprofit hospitals and HMOs suggest that they can easily be persuaded to play along with other providers and may not always vigorously pursue their charitable mission. Keeping cooperatives’ eye on the ball would require close attention to the control and governance of such entities.
The second objection is based on timing and practical considerations. There is ample evidence from our experience with health insurance markets that developing effective coop-sponsored plans will not come easily or quickly. It is clear that new entrants into health insurance markets face a host of obstacles. The prevalence and magnitude of entry barriers is evidenced by the dominance and profitability of existing insurance plans. One or a handful of companies dominate most health insurance markets around the country and these firms have enjoyed consistent and robust profits. Economic theory would suggest that such profit opportunities should have invited entry by rivals eager to capture some of the profits available in those markets.
Additional proof of the obstacles to entry are found in the investigations by insurance commissioners into proposed mergers in their states. In Pennsylvania for example, the proposed merger of Highmark and Independence Blue Cross would have combined the dominant insurers in two large distinct geographic regions of the state. Evidence provided to the State indicated that numerous attempts by regional and national firms such as Aetna and Coventry to enter both markets had proved unsuccessful over the years. Expert studies suggested that a variety of factors including brand loyalty, difficulties in securing physician and hospital network contracts, regulatory and information gathering costs, and obstacles created by the contracting practices of incumbent providers, thwarted entry. Newly formed coops needing to acquire expertise and develop networks will surely face enormous difficulties penetrating markets.
Professor Greaney’s is a nationally recognized expert on health care law and the Chester A. Myers Professor of Lawand the Director, Center for Health Law Studies, St. Louis University School of Law. Thomas Greaney has spent the last two decades examining the evolution of the health care industry. He is also a frequent contributor at Health Reform Watch where this post first appeared. His recent testimony to the Senate on “Competition in the Health Care Marketplace” may be found here.
A. Create an exchange with standardized plans, make individuals buy through the exchange and limit outside subsidies to the value of the lowest cost plan.
B. Tax health benefits (starting with those over the value of the cheapest plan)
C. Phase in the same system for Medicare
D. Phase out employer based insurance, giving everyone a voucher for the lowest cost plan based on a dedicated tax like a VAT.
Meanwhile in the LA Times, Newt Gingrich, who continues to smell blood in the Palin-infested waters, spouts BS that would destroy any sensible Enthoven-style reform. Apparently in Newt-world a regulated insurance package of standardized benefits is government bureaucracy run amok.