uhc proposals training 4-14-07

8/3/2019 UHC Proposals Training 4-14-07

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Proposals for Universal Health Care

or

Back to the Health Care Future

Leonard Rodberg

Urban Studies Dept, Queens College

And

NY Metro ChapterPhysicians for a National Health Program

April 14, 2007


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Psst! Wanna see my health plan?


3/35

Why Health Is On the Agenda


4/35

A Declining Number of Firms

Are Offering Insurance


5/35

Firms Shift Health Insurance

Costs to Workers


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Number of Uninsured Americans (Millions)

1980 1985 1990 1995 2000

45

40

35

30

25

20

Source: U.S. Census Bureau

Rising Number of uninsured


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0

10

20

30

40

50

60

70

80

90

100

Unite

dStates

Australia

Austria

Belgium

Canada

CzechRepublic

Denm

ark

Finlan

d

France

Germ

any

Greece

Hung

ary

Iceland

Ireland

Italy

Japan

Korea

Luxembourg

Mexic

o

Netherlands

NewZe

aland

Norw

ay

Portu

gal

Slovak

RepublicSp

ain

Sweden

Switzerland

Turkey

Unite

dKingdom

Percent

Population Covered by Public System

The Outlier Nation:

Our Public System Covers Fewer

Source: F. Colombo and N. Tapay, Private Health Insurance in OECD Countries, OECD 2004


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0

5

10

15

20

25

30

35

40

Unite

dStates

Australia

Austria

Belgium

Canada

CzechRepublic

Denm

ark

Finland

France

Germ

any

Greece

Hung

ary

Iceland

Ireland

Italy

Japan

Korea

Luxembourg

Mexico

Netherlands

NewZealand

Norw

ay

Portu

gal

Slovak

Republic

Spain

Sweden

Switzerland

Turkey

Unite

dKingdom

Percent

Private Health Insurance Percent of Total Cost

While Private Insurance Dominates

Source: F. Colombo and N. Tapay, Private Health Insurance in OECD Countries, OECD 2004


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U.S. Health Costs are 70% Greater

than the Median of Other Countries

Unite

dS

tates


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THE MAJORITY OF AMERICANS

HAVE PRIVATE INSURANCE

Total Population

Private health insurance- Employer-provided

- Individual

Public health insurance

Medicare Medicaid

Uninsured

Million %

288 100.0%

174 60.5 %160 55.6%

14 4.9%

72 25.0%

41 14.2%31 10.8%

42 14.6%

Source: National Center for Health Statistics, 2003


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BUT IT PAYS MUCH LESS THAN

HALF THE COST

2004Personal Health Expenditures

Private Funds

Private health insurance- Self-funded plans

- Insurance company plans

Out-of-pockets payments

Other private funds

Public Funds* Medicare Medicaid

Other public expenditures

$ Billion %$ 1,753 100%

$ 965 54%

$ 658 37%$340 19%

$318 18%

$ 236 13%

$ 70 4%

$ 789 46%$ 309 18%$ 293 17%

$ 187 11%

* Does not include tax subsidy for private insurance. See Woolhandler & Himmelstein, HealthAffairs 2002Source: Centers for Medicare and Medicaid Services, 2006


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HIGH COST OF HEALTH

INSU

RANCE PREMIU

MSNational Average for Employer-provided Insurance

Single Coverage $4,024 per year Family Coverage $10,880 per year

Note: Annual income at minimum wage = $10,300

Annual income of average Wal-Mart worker = $17,114

Source: Kaiser Family Foundation/HRET Survey, 2005


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The Good News --

and the Bad News

Universal health care is accepted as

the goal. It is defined simply as requiring that

the uninsured buy private insurance.


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The Massachusetts Plan Individual Mandate: Uninsured people must buy

their own health care or face financial penalties.

Sliding subsidies for uninsured up to 300% of thefederal poverty level.

Employer Fair Share Assessment: Fee of $295per year per worker for businesses not covering

their employees. Medicaid expansions: Children up to 300% of

poverty.


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Personal

Responsibility

Incremental

Expansion


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Wyden Healthy Americans Act

slash and burn

Supporters: SEIU, Safeway, Families USA

Eliminate the tax deductibility of employer-based insurance end employer benefit

Require individual purchase of insurance

Transitional payments by employers

Subsidies to low-income individuals

Relies on competition to contain costs


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John Edwards Planindividual mandate with a pretty face

Individual mandate with community rating

Employer mandate (play or pay)

Medicaid and SCHIP expansion Subsidies for low-income

Regional purchasing plans (Health Markets)

Offers government program (single payer?) aswell as private plans. (cf Medicare Advantage)

Note: Jacob Hacker plan: Identical content,different verbiage


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Edwards Seductive Verbiage For everyone: Shared responsibility

For the fearful: Lets people keep what they have

For those worried about cost: Everyone will

work together to make the system more efficient

For single payer advocates: Individuals and

businesses can choose if they want thegovernment plan; if so, the system will evolve

toward a single-payer approach.(For more, see www.johnedwards.com)


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Ten Top Reasons Why an

Individual Mandate is Bad Policy10. Enforcement is bad for public health

9. Insurance companies will resist and

undermine community rating andguaranteed issue

8. Will not lead to universal coverage

7. If premium is affordable, health care isnot (copays, deductibles)

6. Complexity/humiliation of means testing


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Ten Top Reasons Why an

Individual Mandate is Bad Policy5. Even more bureaucracy (Health Markets)

4. Private health insurance will be a continuing

consumers nightmare (copays, deductibles,exclusions, denials, appeals)

3. Increases the cost of the system, most going to

private insurance companies2. No cost control: continually rising cost


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And the Top Reason Why an

Individual Mandate is Bad Policy1. It doesnt reform the system at all. It would not

help any of us who think were insured.-- Half of middle- and lower-income adults experience seriousproblems paying medical bills or insurance premiums.(Commonwealth Fund 2006)

-- Three-fourths of those who declare medical bankruptcy hadinsurance (D.Himmelstein et al, Health Affairs, 2005)

It doesnt solve any of the problems (especially risingcosts) that concern everyone.

It is not a real structural change.


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Choice: Whats Wrong With Offering a

Public Plan vs. a Private Plan? Purchaser cannot predict future health needs, and

so has no basis for choosing plan

Purchaser cannot know the impact of private planrestrictions until illness hits

Private plans want to avoid (i) sick people and (ii)paying for illness

Deceptive/seductive insurance companyadvertising compared to govt advertising

A level playing field is impossible

It is not single payer!


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THE EVIDENCE FROM MEDICARE

Since 1997, the US has conducted a head-to-headcomparison between private insurance (Medicare

Choice+, now called Medicare Advantage) andpublic Medicare.

The result:

Private insurance companies require a subsidy of at

least 15% just to stay in the business. Fewer than 1 in 6 Medicare-eligibles choose the

private insurance option.


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Common Features of these Plans They identify the problem as too many uninsured.

Their solution: Require everyone to haveinsurance

Employers contribute but dont necessarily offerinsurance

These plan dont reform the structure at all True objective of these plans:

Save the private insurance industry


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A Familiar Headline But Its Wrong!

It is the unaffordable, inefficient private

insurance system that is collapsing.

Employers should contribute their fair share,

just not through private insurance.

Going backwards to individual purchase of

insurance is not the answer.

Employer-Based Health Insurance System Collapsing

(Wall Street Journal, 7/17/06)


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Some of the Problems created by

private insurance

SOME OF THE PROBLEMS

CREATED BY PRIVATE INSURANCE

Excessive administrative costs

Excessive complexity

Continuously rising costs

Lack of coordination, budgeting, and planning

Regressive financing via premiums

Widespread underinsurance and bankruptcy

Interference in physician decision-making

The hassle factor


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SO HERES THE SOLU

TION: Expand Medicare to cover everyone

Improve the coverage it offers

Eliminate private insurance

Expanded and Improved

Medicare for AllConyers Bill - HR 676

-- The single payer solution --


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HOW WOULD MEDICARE FOR

ALL WORK? Everyone would receive a Medicare card

assuring payment for all needed care

Complete free choice of doctor and hospital Doctors and hospitals remain independent,

negotiate fees and budgets with Medicare

Progressive taxes go to Medicare Trust Fund Public agency processes and pays bills


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SOME IMPLICATIONS OF

MEDICARE FOR ALL The same coverage for everyone:No means

testing; coverage would not depend on

income, employment or age Medicaid would no longer be needed

Hundreds of billions of dollars in

administrative costs would be saved Costs would be controlled through capital

planning and quality reviews conductedthrough the single insurer


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How Would It Be Paid For?

One Example:

Revenue Sources for

Single PayerProgram

Employer Payroll

Tax (8.17%)

33%

Federal

Government

(existing)

34%

Other

8%

State and Local

Govt (existing)

10%

Employee Payroll

Tax (3.78%)

15%

Note: Payroll tax on incomes above $7,000 and below $200,000 only.Source: Health Care for All Californians Act: Cost and Economic Impacts Analysis, The Lewis Group, January 19, 2005


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Billing and Insurance Costs

Account For More Than 20% of

All Health Care Costs

BIR = Billing- and insurance-related costs; profit and marketing costs

not included

Source: James G. Kahn et al, The Cost of Health Insurance Administration in California: Estimates forInsurers, Physicians, and Hospitals,Health Affairs, 2005


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Covering Everyone and Saving Money

through Medicare for AllAdditional costs

Covering the uninsured and poorly-insured +6.4%

Elimination of cost-sharing and copays +5.1%

SavingsBulk purchasing of drugs & equipment -2.8%

Reduced hospital administrative costs -1.9%

Reduced physician office costs-

3.6%Reduced insurance administrative costs -5.3%

Primary care emphasis & reduce fraud -2.2%

Net Savings -4.3%

Source: Health Care for All Californians Plan, Lewin Group, 2005


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WHY IS SUCH A NATIONAL HEALTH

PROGRAM POSSIBLE TODAY? Private insurance is not addressing the fundamental

problems of cost, choice, access and quality.

Everyone is affected: the uninsured, theunderinsured, and everyone else who is

insecurely insured.

Employers who provide insurance want to be relievedof the burden of rising costs and unfair competitionfrom employers who don't offer insurance.

Small businesses want to offer insurance to theiremployees but cant afford it.

Every other industrialized country has done it.


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PHYSICIANS FOR A NATIONAL

HEALTH PROGRAM (PNHP) says:Who needs insurance companies anyway? Limited reforms that keep private insurance in place

have been tried and failed.

If we get rid of the insurance companies, we can havea Medicare for All system that is:

- Simpler

- Less costly

-Better for our health

- Equitable, and

- Covers everyone

Lets do it!


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A Final Word

uhc proposals training 4-14-07

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