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Why the Private Health Insurance Industry Has to Go

by John Geyman MD
for Physicians for a National Health Program, Apr 8, 2015

The private health insurance industry in the U.S. has had a long run since shifting to medical underwriting and a for-profit status in the early 1960s. It finds itself increasingly dependent on the government as the costs and prices of health care have continued upward since the 1980s. Its many perks from government include tax exemptions for employer-sponsored insurance (ESI), privatized Medicare and Medicaid programs, and longstanding over-payments to Medicare Advantage programs. The Affordable Care Act (ACA) has added to these perks since 2010 with subsidized premiums through the exchanges, a “risk corridor system” to protect insurers from losses, and allowing automatic self-renewal for 2015 plans. (1)

Incremental attempts to contain health care costs and reform the system since the 1990s have built upon our current multi-payer financing system. After five years’ experience with the ACA, we now know that insurers themselves are a major barrier to achieving the kind of access to affordable care that our population so desperately needs.

Here are some of the major reasons why private health insurers warrant no further bailout by government and taxpayers.


#BlackLivesMatter — A Challenge to the Medical and Public Health Communities

Mary T. Bassett, M.D., M.P.H.

Mary T. Bassett, M.D., M.P.H.

by Mary T. Bassett, M.D., M.P.H.
N Engl J Med 2015; 372:1085-1087March 19, 2015DOI: 10.1056/NEJMp1500529

Two weeks after a Staten Island grand jury decided not to indict the police officer involved in the death of a black man, Eric Garner, I delivered a lecture on the potential for partnership between academia and health departments to advance health equity. Afterward, a group of medical students approached me to ask what they could do in response to what they saw as an unjust decision and in support of the larger social movement spreading across the United States under the banner #BlackLivesMatter. They had staged “white coat die-ins” (see photoUniversity of Vermont Medical Students during a “Die-In” Protest.) but felt that they should do more. I wondered whether others in the medical community would agree that we have a particular responsibility to engage with this agenda.

Should health professionals be accountable not only for caring for individual black patients but also for fighting the racism — both institutional and interpersonal — that contributes to poor health in the first place? Should we work harder to ensure that black lives matter?

As New York City's health commissioner, I feel a strong moral and professional obligation to encourage critical dialogue and action on issues of racism and health. Ongoing exclusion of and discrimination against people of African descent throughout their life course, along with the legacy of bad past policies, continue to shape patterns of disease distribution and mortality.1 There is great injustice in the daily violence experienced by young black men. But the tragedy of lives cut short is not accounted for entirely, or even mostly, by violence. In New York City, the rate of premature death is 50% higher among black men than among white men, according to my department's vital statistics data, and this gap reflects dramatic disparities in many health outcomes, including cardiovascular disease, cancer, and HIV. These common medical conditions take lives slowly and quietly — but just as unfairly. True, the black–white gap in life expectancy has been decreasing,2 and the gap is smaller among women than among men. But black women in New York City are still more than 10 times as likely as white women to die in childbirth, according to our 2012 data.


The enduring myth of cost shifting

Commentary: don't believe insurers' line that federal cuts are boosting our costs

Columnist Wendell Potter Robin Holland

Columnist Wendell Potter Robin Holland

by Wendell Potter
The Center for Public Integrity, March 30, 2015

Health insurance executives and lobbyists have for years told us that one of the main reasons they charge us so much for coverage is the cost shifting that results from Uncle Sam’s stinginess.

The story goes like this: hospitals are paid so inadequately by government programs like Medicare and Medicaid that they have to charge private insurers more to keep their doors open.

One of the regular communicators of this theory is Karen Ignagni, CEO of America’s Health Insurance Plans, the industry’s biggest PR and lobbying group.

Ignagni pushed this line incessantly during the health care reform debate. She even cited it in response to a question about why the industry was so opposed to the creation of a government-run “public option” health plan.

“What we have is a significant amount of cost shifting because the government underpays,” she said. “Our [premium] rates are higher as a result of that. If you set up a public structure, whatever you call it, and it has the benefit of government rates, we are still being disadvantaged because of the cost shifting.”


Health Care for Immigrants — Implications of Obama's Executive Action

Notably, however, the Obama administration has indicated that immigrants covered under the new policy will continue to be excluded from the ACA's exchanges and tax credits. Similarly, immigrants targeted by the executive action will for the most part remain ineligible for federally funded Medicaid, though some states do provide publicly funded health insurance for some classes of undocumented immigrants. To the extent that work permits lead to an increase in taxes paid by undocumented immigrants, ongoing exclusion of these immigrants from the programs supported by such taxes would be increasingly inequitable.

Benjamin D. Sommers, M.D., Ph.D

Benjamin D. Sommers, M.D., Ph.D

New England Journal of Medicine: Perspective
N Engl J Med 2015; 372:1187-1189March 26, 2015DOI: 10.1056/NEJMp1414949
by Benjamin D. Sommers, M.D., Ph.D., and Wendy E. Parmet, J.D.

On November 20, 2014, President Barack Obama announced his intention to grant millions of undocumented immigrants a reprieve from the threat of deportation, along with the possibility of legal employment in the United States. The announcement came shortly after midterm elections that saw Republicans take control of the Senate and bolster their majority in the House of Representatives, and it followed more than a year of congressional gridlock over the comprehensive immigration-reform bill passed by the Senate. The subsequent decision by a federal district judge in Texas to put President Obama's plan on hold has cast into doubt a policy that — if ultimately upheld — could have substantial effects on the health care system.

The cornerstone of the President's policy is a plan to allow up to 5 million undocumented immigrants (“covered immigrants”) to live and work in the United States. Modeled on the 2012 Deferred Action for Childhood Arrivals (DACA) program, which applied to young adults who arrived in the United States as children, the new policy will allow many more adults who have been here since 2010 to receive deferred-action status. The population affected by the policy is one that currently experiences major disparities in health care coverage and access. Immigrants are far more likely than native-born residents to be uninsured: among adults, an estimated 40% of legal permanent residents and 71% of undocumented immigrants are uninsured, as compared with 15% of U.S.-born citizens.1 Not surprisingly, health care utilization is far lower among immigrants than among citizens.


Skyrocketing drug costs stump insurers, Oregon lawmakers

by Saerom Yoo,
Statesman Journal. March 28, 2015

Sarah Truman pays more than $3,000 per month out of pocket for the medications that alleviate her psoriasis and psoriatic arthritis symptoms enough to allow her to work and live a normal life.

Jim Huls is a multiple myeloma patient who has maxed out two credit cards and lost his home to the bank while trying to balance his medical and pharmaceutical bills.

Both are Oregonians who are appealing to state lawmakers to do something about the rising costs of prescription drugs.

Drug prices have been going up for a long time. However, in 2014 drug spending rose 13.1 percent — the largest annual increase since 2003, according to a report by Express Scripts. Specialty drugs, such as those taken by Truman, largely drove the increases.

Last year, the U.S. Food and Drug Administration approved Harvoni, a $1,125-per-tablet drug for hepatitis C patients. An estimated 3 million Americans have hepatitis C, according to Express Scripts. It is drug prices such as Harvoni's that have policymakers, patients and health plans on alert.


Hospitals Try to Avoid Price Transparency by Advancing Phony Bill

The Oregon Association of Hospitals and Health Systems appeared to outmaneuver the efforts of Sen. Elizabeth Steiner Hayward, SEIU and consumer advocates to demand the right to know what patients are being charged by getting the ranking members of the Senate Health Committee to sign onto a competing measure that does not disclose individual hospital information and provides only outdated average statewide data from the all-payer, all-claims database.

by Chris Gray, for The Lund Report
March 27, 2015

The Oregon Association of Hospitals and Health Systems is moving aggressively to stamp out legislation that would force its members to be transparent about their prices, and the association has introduced a transparency bill that provides them with political cover while doing little to help consumers and nothing to foster competition.

The legislation from the hospitals, Senate Bill 900, calls upon the Oregon Health Authority to use the all-payer, all-claims database to list the median prices at hospitals and hospital clinics for the 50 most common inpatient procedures and 100 most common outpatient procedures.

SB 900 would not give the public any information about individual hospitals that gouge consumers, and the legislation shields those high-cost hospitals from competition that such information would generate. The information from the All-Payer, All-Claims Database would also be outdated as soon as it was published, since it would rely on claims data that had been submitted months and years earlier.

Consumers would have no better answer than now as to what their actual costs might be from any given hospital, since such charges deviate so wildly from the median.