tag:theconversation.com,2011:/au/topics/health-care-policy-32584/articlesHealth care policy – The Conversation2020-11-03T13:26:59Ztag:theconversation.com,2011:article/1489632020-11-03T13:26:59Z2020-11-03T13:26:59ZPoor US pandemic response will reverberate in health care politics for years, health scholars warn<figure><img src="https://images.theconversation.com/files/367112/original/file-20201102-23-1tywzd2.jpg?ixlib=rb-1.1.0&rect=0%2C137%2C5383%2C3419&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A COVID-19 test in Utah. The country's pandemic response has been politicized, making comprehensive changes to public health more difficult. </span> <span class="attribution"><a class="source" href="https://newsroom.ap.org/detail/VirusOutbreakUtah/83ec3c8c78fd46b39752cfeaa6241a66/photo?Query=COVID-19%20surge&mediaType=photo&sortBy=arrivaldatetime:desc&dateRange=Anytime&totalCount=1467&currentItemNo=36">AP Photo/Rick Bowmer</a></span></figcaption></figure><p>Much has been written about the <a href="https://theconversation.com/experts-agree-that-trumps-coronavirus-response-was-poor-but-the-us-was-ill-prepared-in-the-first-place-133674">U.S. coronavirus response</a>. Media accounts frequently turn to experts for their insights – commonly, epidemiologists or physicians. <a href="https://www.kff.org/coronavirus-covid-19/report/kff-health-tracking-poll-july-2020/">Countless surveys</a> have also queried Americans and individuals <a href="https://www.ipsos.com/en/public-opinion-covid-19-outbreak">from around the world</a> about how the pandemic has affected them and their attitudes and opinions. </p>
<p>Yet little is known about the views of a group of people particularly well qualified to render judgment on the U.S.’s response and offer policy solutions: academic health policy and politics researchers. These researchers, like the <a href="https://scholar.google.com/citations?user=QY68LSIAAAAJ&hl=en">two</a> of <a href="https://scholar.google.com/citations?user=UEH-XXoAAAAJ&hl=en">us</a>, come from a diverse set of disciplines, including public health and public policy. Their research focuses on the intricate linkages between politics, the U.S. health system and health policy. They are trained to combine applied and academic knowledge, take broader views and be fluent across multiple disciplines.</p>
<p>To explore this scholarly community’s opinions and perceptions, <a href="https://doi.org/10.1002/wmh3.371">we surveyed hundreds of U.S.-based researchers</a>, first in April 2020 and then again in September. Specifically, we asked them about the U.S. COVID-19 response, the upcoming elections and the long-term implications of the pandemic and response for the future of U.S. health policy and the broader political system.</p>
<p>Overall, the results of our survey – with 400 responses, which have been published in full in <a href="https://doi.org/10.1002/wmh3.371">our recent academic article</a> – paint a picture of a damaged reputation to government institutions. Surveyed scholars also believe the <a href="https://www.theatlantic.com/magazine/archive/2020/09/coronavirus-american-failure/614191/">poor government response</a> will shift the politics of health care. At the same time, our findings don’t show strong belief in major policy changes on health. </p>
<h2>Parceling out the blame</h2>
<p><a href="https://doi.org/10.1002/wmh3.371">We first asked</a> respondents how much responsibility various actors bear for the lack of preparedness in the U.S. Here scholars overwhelming assign blame to one source: 93% of respondents blamed President Trump for the overall lack of preparedness “a lot” or “a great deal.” Moreover, 94% in April and 98% in September saw political motivations as the main drivers of the president’s actions.</p>
<p>The <a href="https://www.cdc.gov/">Centers for Disease Control and Prevention</a> and the <a href="https://www.fda.gov/home">Food and Drug Administration</a>, as well as Congress, also deserve a significant amount of blame, survey respondents said. At the other end of the spectrum, scholars were relatively content with the response by local and state governments as well as that of the World Health Organization.</p>
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<a href="https://images.theconversation.com/files/367030/original/file-20201102-13-1l1jox.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="coronavirus testing site in Los Angeles with cars." src="https://images.theconversation.com/files/367030/original/file-20201102-13-1l1jox.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/367030/original/file-20201102-13-1l1jox.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/367030/original/file-20201102-13-1l1jox.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/367030/original/file-20201102-13-1l1jox.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/367030/original/file-20201102-13-1l1jox.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/367030/original/file-20201102-13-1l1jox.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/367030/original/file-20201102-13-1l1jox.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Insufficient testing was one of the first major problems the U.S. confronted in the pandemic.</span>
<span class="attribution"><a class="source" href="https://newsroom.ap.org/detail/VirusOutbreak/d9637980cbfb4c73ad42c09633e9acbb/photo?Query=coronavirus%20testing%20United%20states&mediaType=photo&sortBy=arrivaldatetime:desc&dateRange=Anytime&totalCount=857&currentItemNo=21">AP Photo/Mark J. Terrill</a></span>
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<p>Notably, perceptions grew significantly more negative for all entities between April and September. This likely reflects frustrations with the continued inability to rein in the spread of the virus.</p>
<h2>Effects on the political system and health policy</h2>
<p>Respondents also offered a particularly grim view of the long-term implications of the failed coronavirus response for the United States. </p>
<p>Survey after survey has shown that partisanship influences individuals’ perceptions of the coronavirus pandemic. Early research indicates that <a href="https://doi.org/10.1017/S0008423920000396">right-leaning media</a> and <a href="https://doi.org/10.1215/03616878-8641506">presidential communication</a> may have significantly contributed to these discrepancies and increased polarization. </p>
<p>And according to scholars in our study, these stirred-up partisan differences may lead to increases in distrust in government, a lack of faith in political institutions and even further growth in political polarization in the long term. </p>
<p>Overall, <a href="https://doi.org/10.1002/wmh3.371">scholars were generally skeptical</a> about any major progressive changes like the adoption of universal health care, paid sick leave, or basic income in the aftermath of the pandemic. At the same time, they also do not expect popular conservative changes like the <a href="https://archives.cjr.org/campaign_desk/medicare_vouchers_explained.php">privatization of Medicare</a> or <a href="https://khn.org/news/5-things-to-know-about-trumps-medicaid-block-grant-plan">block grant Medicaid</a>, which restricts expenditures from the federal government to states to a set lump sum.</p>
<p>Once more, hyperpartisanship, combined with the cumbersome political process, is seen as the major culprit here.</p>
<p>There is one major exception: adoption of a federal <a href="https://www.milkenreview.org/articles/much-ado-about">public option</a>, a government-run health plan to compete with private insurers. Here, more than 60% of scholars initially thought that adoption would be somewhat or very likely in the next five years; however, this number dropped to 50% by September. This expectation appears to be driven by the expectation of a Biden presidency.</p>
<p>Two-thirds of respondents expected public health, health infrastructure, and pandemic preparedness to take on more prominent roles going forward. Just under half expected a larger focus on inequalities and inequities. Yet, with major reforms unlikely, scholars are generally skeptical about much progress on the issues.</p>
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<h2>Looking Ahead</h2>
<p>There is <a href="http://www.DOI.org/10.1056/NEJMp2014836">ample</a> <a href="https://www.jsonline.com/in-depth/news/2020/10/14/america-had-worlds-best-pandemic-response-plan-playbook-why-did-fail-coronavirus-covid-19-timeline/3587922001/">evidence</a> that the U.S. has fared significantly worse than its peers in handling the coronavirus pandemic. </p>
<p>To health policy and politics scholars, this came as no surprise. In the U.S., the pandemic collided with a <a href="https://www.pewresearch.org/topics/political-polarization/">political system rife with distrust and polarization</a>. Both pathologies are mirrored among the American public. Large parts of the population are <a href="https://www.pewresearch.org/science/2019/08/02/trust-and-mistrust-in-americans-views-of-scientific-experts/">wary of the role scientists play in policy</a>. Many subscribe to <a href="https://www.pewresearch.org/fact-tank/2020/07/24/a-look-at-the-americans-who-believe-there-is-some-truth-to-the-conspiracy-theory-that-covid-19-was-planned/">conspiracy theories</a>. </p>
<p>This combination, together with poor leadership, has put coordinated and sustained policy response out of reach. </p>
<p>[<em>Deep knowledge, daily.</em> <a href="https://theconversation.com/us/newsletters/the-daily-3?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=deepknowledge">Sign up for The Conversation’s newsletter</a>.]</p>
<p>To make things worse, the coronavirus has also highlighted the <a href="https://www.ucsf.edu/magazine/covid-inequality">ubiquitous inequities in American society</a>. It has also laid bare the <a href="https://theconversation.com/experts-agree-that-trumps-coronavirus-response-was-poor-but-the-us-was-ill-prepared-in-the-first-place-133674">inadequacies of the safety net or other social protections like paid sick leave</a>.</p>
<p>In our view, no matter the outcome of the elections, the impacts of the failed coronavirus response will likely reverberate through the U.S. political system for decades. Much rebuilding will need to be done.</p><img src="https://counter.theconversation.com/content/148963/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Simon F. Haeder is a Fellow in the Interdisciplinary Research Leaders Program, a national leadership development program supported by the Robert Wood Johnson Foundation to equip teams of researchers and community partners in applying research to solve real community problems.</span></em></p><p class="fine-print"><em><span>Sarah E. Gollust is an Associate Director of the Interdisciplinary Research Leaders Program, a program supported by the Robert Wood Johnson Foundation. She also receives research grants to support her work analyzing media communication and health policy from the Robert Wood Johnson Foundation and the Russell Sage Foundation.</span></em></p>Health policy and politics scholars expect political fallout from the federal response to the pandemic will play out for years, with trust in government taking a big hit.Simon F. Haeder, Assistant Professor of Public Policy, Penn StateSarah E. Gollust, Associate Professor of Health Policy and Management, University of MinnesotaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1296712020-01-14T13:47:28Z2020-01-14T13:47:28ZHeading into Iowa: Where do the Democratic candidates stand on health care coverage?<figure><img src="https://images.theconversation.com/files/309785/original/file-20200113-103994-p61eqr.jpg?ixlib=rb-1.1.0&rect=15%2C309%2C5281%2C3168&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Joe Biden, Elizabeth Warren and Pete Buttigeig at the Oct. 15, 2019 debate at Otterbein University in Westerville, Ohio. </span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/APTOPIX-Election-2020-Debate/369ab17a3a09469eba384c5e3e0b2e3c/16/0">John Minchillo/AP Photo</a></span></figcaption></figure><p>As Democratic presidential hopefuls gather in Iowa for the seventh debate, Iran and foreign policy will likely play a central role. </p>
<p>But health care will remain the most important topic of debate for many Americans. No doubt, all six candidates tonight will talk about their proposals for health health reform using terms like universal coverage, public option, “Medicare for All,” and single-payer. </p>
<p>What do these terms mean, and where do Democratic presidential candidates onstage in Iowa stand on expanding coverage to all Americans?</p>
<h2>First things first: Who should be covered?</h2>
<p>Most Western nations ensure that everyone living in their country has access to insurance coverage. This is referred to as <a href="https://theconversation.com/universal-coverage-single-payer-medicare-for-all-what-does-it-all-mean-for-you-128518">universal coverage</a>. </p>
<p>Generally, this <a href="https://www.who.int/health_financing/universal_coverage_definition/en/">coverage includes</a> access to all needed services and benefits while protecting individuals from excessive costs. </p>
<p>The <a href="https://theconversation.com/us-health-care-system-a-patchwork-that-no-one-likes-85252">U.S. is an exception</a>. Even the <a href="https://doi.org/10.1111/j.1541-0072.2012.00446.x">Affordable Care Act</a> only created what’s called <a href="https://doi.org/10.1111/puar.12065">“near universal coverage</a>” leaving millions of American uninsured.</p>
<p>From a policy perspective, achieving universal coverage is a worthwhile goal. There is <a href="https://www.nytimes.com/2017/07/03/upshot/medicaid-worsens-your-health-thats-a-classic-misinterpretation-of-research.html">ample evidence</a> that insurance coverage generally <a href="https://theconversation.com/universal-coverage-single-payer-medicare-for-all-what-does-it-all-mean-for-you-128518">improves the health and financial security of individuals</a>. </p>
<p>There is no single pathway to universal coverage. Countries that have achieved it have done so in <a href="https://www.commonwealthfund.org/publications/other-publication/2018/dec/multinational-comparisons-health-systems-data-2018">different ways</a>. Democratic presidential candidates all agree that providing coverage to everyone is the ultimate goal. However, they differ widely on how – and how fast – to get there.</p>
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<h2>Single-payer, all-payer and socialized medicine</h2>
<p>One way to get to universal coverage is to create a “<a href="http://www.milkenreview.org/articles/would-state-based-single-payer-health-insurance-cure-what-ails">single-payer system</a>.” This means that one entity, most likely the government, is solely and exclusively responsible for paying for medical goods and services. In short, paying for health care is socialized. </p>
<p>In reality, government is often the dominant but not sole payer and <a href="https://theconversation.com/universal-coverage-single-payer-medicare-for-all-what-does-it-all-mean-for-you-128518">allows for supplemental insurance or for individuals to pay for alternate or additional services</a>. A single-payer system could be confined to providing catastrophic coverage only while allowing for private coverage for additional benefits.</p>
<p>Advocates often hail single-payer systems for their <a href="http://www.milkenreview.org/articles/would-state-based-single-payer-health-insurance-cure-what-ails">administrative simplicity</a>. And single-payer systems <a href="https://doi.org/10.1515/for-2013-0056">do not segregate individuals</a> into different insurance coverage based on their medical status. Single-payer systems are able to use their absolute market and budgeting power to <a href="http://www.milkenreview.org/articles/would-state-based-single-payer-health-insurance-cure-what-ails">hold down costs</a>. </p>
<p>Single-payer systems should not be confused with so-called <a href="https://www.vox.com/2015/2/9/8001173/all-payer-rate-setting">all-payer systems, like those in Germany</a>. In all-payer systems, a number of private entities band together to establish common prices for health care services and benefits. Single-payer should also not be equated with <a href="https://doi.org/10.1215/03616878-7277356">socialized medicine</a>, a medical system wholly owned and operated by government, such as in the <a href="https://www.nhs.uk/">United Kingdom</a> and <a href="https://doi.org/10.1215/03616878-7277356">public hospitals, or the Veterans Health Administration in the U.S.</a> </p>
<p>Sens. Sanders and Warren strongly support converting the U.S. health care system to a single-payer system. All other candidates have shown more limited support without disavowing a single-payer systems as an ultimate destination for health reform.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/307590/original/file-20191218-11914-jl2vxv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/307590/original/file-20191218-11914-jl2vxv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/307590/original/file-20191218-11914-jl2vxv.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/307590/original/file-20191218-11914-jl2vxv.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/307590/original/file-20191218-11914-jl2vxv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/307590/original/file-20191218-11914-jl2vxv.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/307590/original/file-20191218-11914-jl2vxv.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Sen. Elizabeth Warren, D-Mass., and Sen. Bernie Sanders, I-Vt., unveiled their Medicare-for-All plan on Capitol Hill, Sept. 13, 2017.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Congress-Health-Overhaul/00041bcb32ef4535b7ba3caa0a4155cf/4/0">Andrew Harnik/AP Photo</a></span>
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<h2>The progressives’ favorite: ‘Medicare for All’</h2>
<p>The most discussed Democratic health reform proposal, Medicare for All, prominently references <a href="https://doi.org/10.1177/2333392818824472">Medicare</a>, the insurance program that covers most of America’s seniors. Many people do not recognize, however, that traditional Medicare comes with <a href="https://theconversation.com/universal-coverage-single-payer-medicare-for-all-what-does-it-all-mean-for-you-128518">limited benefits and often requires large out-of-pocket payments</a>. </p>
<p>In essence then, Medicare for All proposals <a href="http://www.milkenreview.org/articles/life-and-politics-beyond-the-affordable-care-act">just borrow the Medicare name</a> while implementing a single-payer system in the United States with a generous benefits package. </p>
<p>As proposed by its two most ardent advocates, <a href="https://www.vox.com/2019/4/10/18304448/bernie-sanders-medicare-for-all">Sens. Bernie Sanders, I-Vt.,</a> and <a href="https://www.vox.com/2019/11/1/20942587/elizabeth-warren-medicare-for-all-taxes-explained">Elizabeth Warren, D-Mass.</a>, Medicare for All would eliminate all private insurance. It would be financed by taxes and come with very limited, if any, out-of-pocket costs.</p>
<p>One particular political stumbling block for implementing Medicare for All is that it makes the overall cost of health coverage an obvious focal point. That’s because it unifies all of the country’s exorbitant health expenditures, projected to be <a href="https://www.factcheck.org/2018/08/the-cost-of-medicare-for-all/">roughly US$60 trillion from 2022 to 2031</a>, in one single budget. This creates the perception of being overly costly, while <a href="https://www.factcheck.org/2018/08/the-cost-of-medicare-for-all/">mostly just illustrating current costs</a>. </p>
<p>Moreover, it would create a significant disruption in how Americans experience health insurance, with hundreds of millions of Americans having to give up their current insurance. Many of them would certainly be upset as the vast majority of them rate their insurance as <a href="https://news.gallup.com/poll/245195/americans-rate-healthcare-quite-positively.aspx">excellent or good</a>.</p>
<p>The four other candidates have cited these concerns extensively, saying that the systemic disruptions and lack of widespread political support would stymie a quick transition to Medicare for All. </p>
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<img alt="" src="https://images.theconversation.com/files/309799/original/file-20200113-103979-vvwttc.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/309799/original/file-20200113-103979-vvwttc.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=394&fit=crop&dpr=1 600w, https://images.theconversation.com/files/309799/original/file-20200113-103979-vvwttc.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=394&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/309799/original/file-20200113-103979-vvwttc.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=394&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/309799/original/file-20200113-103979-vvwttc.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=495&fit=crop&dpr=1 754w, https://images.theconversation.com/files/309799/original/file-20200113-103979-vvwttc.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=495&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/309799/original/file-20200113-103979-vvwttc.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=495&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Democratic presidential candidates Amy Klobuchar, left, and Tom Steyer at the Dec. 19, 2019 debate in Los Angeles.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Election-2020-Debate/704f38b465a24e9a8406f00a02baf874/6/0">Chris Carlson/AP Photo</a></span>
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<h2>The moderates’ response: The public option</h2>
<p><a href="http://www.milkenreview.org/articles/life-and-politics-beyond-the-affordable-care-act">Not all Democrats</a> argue for such a complete do-over of the American health care system. </p>
<p>Most Democratic presidential candidates are supporting a further expansion of the Affordable Care Act. <a href="https://www.politico.com/story/2019/07/15/joe-biden-health-care-plan-1415850">Led by Joe Biden</a>, these proposals contain a <a href="https://theconversation.com/universal-coverage-single-payer-medicare-for-all-what-does-it-all-mean-for-you-128518">so-called public option</a> combined with a number of regulatory reforms. These proposals would largely retain the existing structure of the health care system and preserve a role for private insurance. </p>
<p>The term “<a href="https://doi.org/10.1377/hlthaff.2010.0363">public option</a>” first gained traction during <a href="https://doi.org/10.1111/j.1541-0072.2012.00446.x">the debate over the Affordable Care Act</a> in 2010. Then, progressive Democrats sought to include a government-run insurer in the <a href="https://doi.org/10.1215/03616878-2882219">ACA marketplaces</a>. Yet the latest <a href="https://www.politico.com/story/2019/07/15/joe-biden-health-care-plan-1415850">public option</a> concept is significantly more transformative than its ACA cousin. It would be open to every American, whether they purchase their own insurance or receive it from their employer. This public insurer would also use its market power to negotiate better prices. </p>
<p>Four Democratic candidates have come out strongly supporting a public option. These include Biden, former South Bend Mayor Pete Buttigieg, Sen. Amy Klobuchar, D-Minn., and Tom Steyer. </p>
<p>However, Warren has expressed <a href="https://www.vox.com/policy-and-politics/2019/11/15/20966674/elizabeth-warren-medicare-for-all-plan-public-option">support for a public option</a> during a transitional period to Medicare for All. Over time, the public option might <a href="https://www.vox.com/2019/7/16/20694598/joe-biden-health-care-plan-public-option">function as a bridge toward a single-payer system</a>. </p>
<p>While Democratic candidates largely break into two camps when it comes to health care reform, there is general consensus about the importance of providing affordable access to health care coverage. All candidates have come out strongly in support of protecting the Affordable Care Act until needed adjustments can be made.</p>
<h2>Comparison to Republican plans</h2>
<p>Almost 10 years after the ACA has been signed into law, a <a href="https://www.bloomberg.com/opinion/articles/2020-01-10/obamacare-medicaid-expansion-defies-republican-health-care-chaos-k58552bp">comprehensive Republican health reform proposal has failed to emerge</a>. Yet there remains little doubt that the Republican health reform would look dramatically different from Democrats. </p>
<p>While details remain sparse, any Republican reform would likely <a href="https://rsc-johnson.house.gov/news/press-releases/rsc-releases-health-care-plan">eliminate many of the coverage expansions of the ACA</a>. <a href="https://theconversation.com/how-undoing-obamacare-would-harm-more-than-the-health-of-americans-129177">Millions of Americans gained coverage</a> because they were allowed to stay on their parents’ health insurance until age 26. <a href="https://theconversation.com/how-undoing-obamacare-would-harm-more-than-the-health-of-americans-129177">Millions more</a> gained insurance because of the expansion of Medicaid or in the ACA marketplaces, often with the help of premium subsidies. </p>
<p>Republicans would likely also <a href="https://rsc-johnson.house.gov/news/press-releases/rsc-releases-health-care-plan">transform the Medicaid program,</a> which provides coverage to <a href="https://www.medicaid.gov/medicaid/program-information/medicaid-and-chip-enrollment-data/report-highlights/index.html">close to 70 million Americans</a>. They would do this by limiting the financial contribution of the federal government to Medicaid.</p>
<p>Finally, they would likely also <a href="https://rsc-johnson.house.gov/news/press-releases/rsc-releases-health-care-plan">undo many if not all of the insurance market reforms</a> of the ACA. They include, for example, guaranteed coverage of <a href="https://theconversation.com/how-pre-existing-conditions-became-front-and-center-in-health-care-vote-77138">pre-existing conditions</a> and the prohibition for insurance carriers to <a href="https://theconversation.com/how-the-latest-effort-to-repeal-obamacare-would-affect-millions-84317">impose annual and lifetime limits on benefits</a>.</p>
<p>With all the talk on both sides of reform, political realities make it likely that neither Republicans nor Democrats will have their way any time soon. </p>
<p>However, with <a href="https://theconversation.com/how-undoing-obamacare-would-harm-more-than-the-health-of-americans-129177">lawsuits continuing to threaten the ACA,</a> Americans could quickly find the current system, which <a href="https://www.kff.org/health-reform/poll-finding/6-charts-about-public-opinion-on-the-affordable-care-act/">most have come to support</a>, dismantled. And, of course this would entail a return to the system before the ACA – a system few would recognize and which could meet far fewer people’s health care coverage needs. </p>
<p>[ <em>You’re smart and curious about the world. So are The Conversation’s authors and editors.</em> <a href="https://theconversation.com/us/newsletters?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=youresmart">You can read us daily by subscribing to our newsletter</a>. ]</p><img src="https://counter.theconversation.com/content/129671/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Simon F. Haeder is a Fellow in the Interdisciplinary Research Leaders Program, a national leadership development program supported by the Robert Wood Johnson Foundation to equip teams of researchers and community partners in applying research to solve real community problems.</span></em></p>Among the issues candidates will debate Tuesday night is health care – an important, yet confusing, topic for viewers. An expert simplifies, explaining where and what the candidates stand for.Simon F. Haeder, Assistant Professor of Public Policy, Penn StateLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1244622019-10-04T18:10:10Z2019-10-04T18:10:10ZHow the US could afford ‘Medicare for all’<figure><img src="https://images.theconversation.com/files/295086/original/file-20191001-173375-kx5th2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Several Democrats running for president in 2020 support some version of Medicare for all. </span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Congress-Health-Overhaul/282fcbe52d4c41798af387619f949ee1/118/0">AP Photo/Andrew Harnik</a></span></figcaption></figure><p>Health care is <a href="https://www.realclearpolitics.com/real_clear_opinion_research/new_poll_shows_health_care_is_voters_top_concern.html">Americans’ number-one priority</a>, based on recent polls, so it’s no wonder it’s been a <a href="https://www.npr.org/2019/09/13/760364830/democratic-debate-exposes-deep-divides-among-candidates-over-health-care">hot topic</a> in the Democratic primary.</p>
<p>Every candidate is <a href="https://www.washingtonpost.com/graphics/politics/policy-2020/medicare-for-all/">offering a plan</a>, ranging from Joe Biden’s Affordable Care Act upgrade to Bernie Sanders’ “Medicare for all” that would abolish private health insurance. Even the president is joining the bandwagon and <a href="https://www.npr.org/sections/health-shots/2019/10/03/766816709/targeting-medicare-for-all-proposals-trump-lays-out-his-vision-for-medicare">unveiled his own Medicare plan</a>. </p>
<p>On the high end, a full-scale single-payer heath care system would come at a steep price: <a href="https://www.hopbrook-institute.org/single-post/2019/03/29/Working-Paper-No-2-Yes-We-Can-Have-Improved-Medicare-for-All">I estimate about US$40 trillion</a> over 10 years. </p>
<p>There is, however, a simpler and less costly path toward single-payer, and it may have a better chance of success: simply strike the words “who are age 65 or over” from the <a href="https://www.ssa.gov/OP_Home/ssact/title18/1811.htm">1965 amendments to the Social Security Act</a> that created Medicare, which would mean virtually everyone would be covered by the existing Medicare program.</p>
<p>I have been researching health care for over four decades. While this idea wouldn’t be single-payer – in which the government covers all health care costs – and private insurers would continue to operate alongside Medicare, I believe it would be a substantial improvement over the current system. And it might even be <a href="http://www.sacbee.com/opinion/op-ed/soapbox/article165105902.html">politically possible</a>.</p>
<h2>Medicare and what it was meant to be</h2>
<p>Striking the words “over 65” from the Medicare statutes was an idea <a href="https://theconversation.com/when-pat-and-bob-nearly-saved-health-care-reform-a-lesson-in-senatorial-bedside-manner-81649">championed by the late Sen. Daniel Patrick Moynihan</a>. </p>
<p>Moynihan, who held several roles in the Kennedy and Johnson administrations, was an <a href="http://www.hup.harvard.edu/catalog.php?isbn=9780674574410">original architect of the War on Poverty</a> and a central figure in the evolution of health care policy in the latter half of the 20th century. </p>
<p><a href="https://global.oup.com/academic/product/healthy-wealthy-and-fair-9780195170665?cc=us&lang=en&">Many original Medicare advocates intended</a> it to be the basis for universal health insurance. A key reason it serves so well as the foundation is that it includes a funding mechanism – the 2.9% Medicare payroll tax paid by you and your employer, alongside modest monthly premiums.</p>
<p>In addition, its limited scope, skimpy benefits and cost-sharing keep costs low. Medicare covers only a <a href="https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Age-and-Gender.html">little more than half</a> of participants’ health care spending, forcing many elderly Americans to buy private insurance and pay significant out-of-pocket expenses. A little over 11 million poorer participants <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4193634/">also rely on Medicaid</a>, especially for long-term care.</p>
<p>For example, <a href="https://www.medicare.gov/coverage/inpatient-hospital-care">Medicare covers hospitalization</a> only after a person has paid the $1,364 deductible, and there’s a copay of $341 per day after 60 days and double that beyond 90. It also covers only 80% of the cost of doctor visits and the use of medical equipment – though only after a <a href="https://www.cms.gov/newsroom/fact-sheets/2019-medicare-parts-b-premiums-and-deductibles">$185 deductible</a> and the monthly $136 premium. </p>
<p>Still, it provides meaningful protection against the <a href="https://www.cnbc.com/id/100840148">potentially crippling cost</a> of accident or illness. </p>
<h2>Giving Medicare to everyone</h2>
<p>In its pure form, a single-payer program would make the government everyone’s insurer, largely replacing private insurance.</p>
<p><a href="http://www.businessinsider.com/us-single-payer-debate-comparisons-to-canada-uk-germany-2017-6">This is the way</a> health insurance is provided in the United Kingdom and Canada. Sanders’ plan would follow this framework, even extending it to cover long-term care.</p>
<p>A simple expansion of Medicare would be more like a hybrid system in which the government program exists alongside private insurers, with residents free to use any combination of the two. </p>
<p>One of the reasons single-payer health care has failed in the United States is that even though it might eventually lower costs, it would require substantial new taxes up front. Sanders’ plan, as I noted earlier, <a href="https://www.hopbrook-institute.org/single-post/2019/03/29/Working-Paper-No-2-Yes-We-Can-Have-Improved-Medicare-for-All">would cost around $4 trillion a year</a>. But because of its lower benefit levels and built-in revenue stream, a simple Medicare expansion would cost substantially less, maybe only half that. </p>
<p>In 2018, the last year with complete data, <a href="https://www.kff.org/medicare/state-indicator/total-medicare-beneficiaries/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D">nearly 60 million Americans</a> received Medicare benefits – including most elderly Americans and 9 million who were disabled. <a href="https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nhe-fact-sheet.html">Total spending was over $700 billion</a> that year, or an average of $11,800 per recipient. </p>
<p>A simple expansion would add the nondisabled population under age 65 to Medicare: <a href="https://www.kff.org/other/state-indicator/total-population/?dataView=1&currentTimeframe=0&selectedDistributions=uninsured&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D">28 million without insurance</a>, 66 million <a href="http://www.kff.org/health-reform/state-indicator/total-monthly-medicaid-and-chip-enrollment/?currentTimeframe=18&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D">covered by Medicaid or the Children’s Health Insurance Plan</a> and 176 million with private insurance. For the <a href="http://www.dollarsandsense.org/Funding-Medicare-for-All-explanation-170918.pdf">purposes of my calculations</a>, which I last conducted earlier this year, I assume everyone eligible for Medicare would take advantage of the program. </p>
<p>Because the vast majority of the new enrollees would be younger and healthier than current Medicare participants, the cost per person would be much less, or about $5,527 for the <a href="http://www.thesoutherninstitute.org/docs/publications/Policy%20Resources/KaiserReport.pdf">once uninsured</a> and $3,593 for everyone else. With a <a href="http://www.dollarsandsense.org/Funding-Medicare-for-All-explanation-170918.pdf">few other calculations</a>, the total annual price tag of an expansion would tally around $836 billion.</p>
<h2>Substantial savings</h2>
<p>Something that often gets lost in the debate over the cost of single-payer is that its implementation would lead to a host of savings that make the bill to taxpayers a lot less than the sticker price. </p>
<p><a href="https://www.hopbrook-institute.org/single-post/2019/03/29/Working-Paper-No-2-Yes-We-Can-Have-Improved-Medicare-for-All">I estimate</a> that a full single-payer system would likely save about 20% of current spending, or nearly $700 billion in 2019. A simple Medicare expansion – the kind I’m suggesting here – wouldn’t save quite as much, but it’d still be significant.</p>
<p>So where would the savings come from? </p>
<p>To begin with, <a href="http://www.commonwealthfund.org/interactives/2017/july/mirror-mirror/?omnicid=EALERT1243408&mid=gfriedma@econs.umass.edu">studies show</a> that medical billing is more expensive in the U.S. than in many countries. </p>
<p>The U.S. health care system <a href="https://www.ncbi.nlm.nih.gov/pubmed/22419800">spends twice as much</a> as Canada, for example, because <a href="http://annals.org/aim/article/2605414/single-payer-reform-only-way-fulfill-president-s-pledge-more">more “payers”</a> means more complexity. Savings from a simple Medicare expansion could reduce this waste by about $89 billion a year.</p>
<p>Another source of savings is on insurance administration. Private insurers <a href="http://cepr.net/blogs/cepr-blog/overhead-costs-for-private-health-insurance-keep-rising-even-as-costs-fall-for-other-types-of-insurance">spend more than 20%</a> of total expenditures on overhead, compared with <a href="http://healthaffairs.org/blog/2011/09/20/medicare-is-more-efficient-than-private-insurance/">around 2%</a> for traditional Medicare. Savings from moving everyone to Medicare would approach around $200 billion because of economies of scale, lower managerial salaries and more meager marketing expenses.</p>
<p>A third way a simple Medicare expansion would yield savings is by <a href="https://www.forbes.com/sites/theapothecary/2011/08/22/hospital-monopolies-the-biggest-driver-of-health-costs-that-nobody-talks-about/#47bf25132ce8">reducing the ability of hospital networks with market power</a> to <a href="https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/Inpatient2015.html">overcharge</a> private insurers. By using its market power to negotiate lower prices, Medicare pays prices barely half as high <strong>and</strong> <a href="http://medpac.gov/docs/default-source/reports/mar17_entirereport224610adfa9c665e80adff00009edf9c.pdf?sfvrsn=0">is able to pay 22% less</a> for the same services as do private health insurers. If we all paid Medicare prices, we would save nearly $400 billion on hospital overcharging.</p>
<p>Making conservative estimates, and assuming that the expanded Medicare would only cover services it already does, these three areas then would save $220 billion, bringing the cost down to $618 billion. </p>
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<h2>One small step</h2>
<p>While $618 billion still seems like a hefty price tag, taxes wouldn’t have to be raised much to pay for it. </p>
<p>For starters, most everyone would pay the <a href="https://www.medicare.gov/your-medicare-costs/part-b-costs/part-b-costs.html">premiums already charged</a> by Medicare. This would generate an additional $210 billion in revenue.</p>
<p>In addition, a Medicare expansion would reduce the need for two current insurance subsidies: one for <a href="https://www.treasury.gov/resource-center/tax-policy/Documents/Tax-Expenditures-FY2016.pdf">employer-provided insurance plans</a> and another that the <a href="https://www.cbo.gov/sites/default/files/recurringdata/51298-2015-03-aca.pdf">ACA provides insurers</a>. This would save about $161 billion. </p>
<p>This leaves about $246 billion that would still need to be raised through additional taxes. This could be done with an increase in the <a href="https://www.thebalance.com/fica-taxes-social-security-and-medicare-taxes-39825">Medicare tax</a> that gets deducted from your paycheck. The tax, which is split evenly between employee and employer, would need to rise to 5.9% from 2.9% today. This would amount to just under $15 a week for the typical employee. </p>
<p>Campaigns for universal health insurance coverage have failed in the United States <a href="http://www.nejm.org/doi/full/10.1056/NEJMhpr1411701">when they run up against</a> the cost of providing coverage. Medicare, <a href="https://hub.jhu.edu/2015/07/23/medicare-at-50/">America’s greatest success</a> in advancing health care, succeeded precisely because it was limited and had its own dedicated funding streams. </p>
<p>We might learn from this example. Rather than jump all the way to a comprehensive single-payer system like the one Sanders favors, we could take a step along the way at a fraction of the cost by simply expanding Medicare to everyone who wants it.</p>
<p><em>This is an updated version of an <a href="https://theconversation.com/medicare-for-all-could-be-cheaper-than-you-think-81883">article originally published</a> on Sept. 19, 2017.</em></p><img src="https://counter.theconversation.com/content/124462/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Gerald Friedman is affiliated with Business for Medicare for All and Healthcare-Now.</span></em></p>There’s a very simple way to give Medicare to all: delete six words from the legislation that created the program in 1965.Gerald Friedman, Professor of Economics, UMass AmherstLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1112562019-02-07T11:31:35Z2019-02-07T11:31:35ZWhy the US has higher drug prices than other countries<figure><img src="https://images.theconversation.com/files/257593/original/file-20190206-174870-77ut05.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Policymakers and consumers are well aware of rising pharmaceuticals prices.</span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Pharma-Pills/c1bebab162b84b9084c5640d04daaa4f/34/0">AP Photo/Elise Amendola</a></span></figcaption></figure><p>Spending on pharmaceuticals is <a href="https://www.commonwealthfund.org/publications/issue-briefs/2017/oct/paying-prescription-drugs-around-world-why-us-outlier">on the rise worldwide</a>. And it well should be. Today, we are able to cure some diseases <a href="https://www.healthline.com/health/hepatitis-c/can-it-be-cured">like hepatitis C</a> that were virtual death sentences just a few years ago. This progress required significant investments by governments and private companies alike. Unquestionably, the world is better off for it.</p>
<p>Unfortunately, as <a href="https://www.nytimes.com/interactive/2019/02/05/us/politics/trump-state-of-union-speech-transcript.html">President Trump pointed out in the State of the Union address</a>, the United States has borne a significant amount of the negative effects associated with this development. For one, its <a href="https://www.penguinrandomhouse.com/books/318776/an-american-sickness-by-elisabeth-rosenthal/9780143110859/">regulatory apparatus has focused largely on drug safety</a>, yet regulators have failed to emphasize cost-effectiveness when it comes to both new and existing drugs. </p>
<p>At the same time, the United States also pays significantly higher prices than the rest of the developed world when it comes to prescription drugs, due primarily to <a href="https://www.penguinrandomhouse.com/books/318776/an-american-sickness-by-elisabeth-rosenthal/9780143110859/">limited competition among drug companies</a>. </p>
<p>These two problems are well-known to policymakers, consumers and scholars alike. The Trump administration’s recent <a href="https://www.hhs.gov/about/news/2019/01/31/trump-administration-proposes-to-lower-drug-costs-by-targeting-backdoor-rebates-and-encouraging-direct-discounts-to-patients.html">proposal</a> seeks to lower costs by restructuring drug discounts that occur between pharmaceutical companies, health insurers and entities called <a href="https://www.statnews.com/2018/08/27/pharmacy-benefit-managers-good-or-bad/">pharmacy benefit managers</a>. </p>
<p>But in my view as a health policy scholar, the plan does little to address the underlying problems of prescription drugs in the U.S. I believe the U.S. can refocus its regulatory approach to pharmaceuticals, adapted from the one used in Europe, to better connect the value prescription drugs provide and their price. </p>
<h2>The US and other countries</h2>
<p>Until the mid-1990s, the <a href="https://www.commonwealthfund.org/publications/issue-briefs/2017/oct/paying-prescription-drugs-around-world-why-us-outlier">U.S. was really not an outlier</a> when it came to drug spending. Countries like Germany and France exceeded the U.S. in per capita drug spending. However, since then, spending growth in the U.S. has dramatically outpaced other advanced nations. While per capita spending in the <a href="https://www.commonwealthfund.org/publications/issue-briefs/2017/oct/paying-prescription-drugs-around-world-why-us-outlier">U.S. today exceeds US$1,000 a year, the Germans and French pay about half</a> that.</p>
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<p>And it is not like Americans are overly reliant on prescriptions drugs as compared to their European counterparts. Americans <a href="https://www.commonwealthfund.org/publications/issue-briefs/2017/oct/paying-prescription-drugs-around-world-why-us-outlier">use fewer prescription drugs</a>, and when they use them, <a href="https://www.commonwealthfund.org/publications/issue-briefs/2017/oct/paying-prescription-drugs-around-world-why-us-outlier">they are more likely to use cheaper generic versions</a>. Instead the discrepancy can be traced back to the issue plaguing the entirety of the U.S. health care system: <a href="https://www.commonwealthfund.org/publications/issue-briefs/2017/oct/paying-prescription-drugs-around-world-why-us-outlier">prices</a>.</p>
<p>The reasons for the divergence starting in the 1990s are relatively straightforward. For one, dozens of so-called blockbuster drugs like <a href="https://www.kiplinger.com/slideshow/investing/T027-S001-the-15-all-time-best-selling-prescription-drugs/index.html">Lipitor</a> and <a href="https://www.kiplinger.com/slideshow/investing/T027-S001-the-15-all-time-best-selling-prescription-drugs/index.html">Advair</a> entered the market. The number of drugs grossing more than <a href="https://www.nytimes.com/2018/11/12/upshot/why-prescription-drug-spending-higher-in-the-us.html">$1 billion in sales increased from six in 1997 to 52 in 2006</a>. The recent introduction of <a href="https://www.healthline.com/health/hepatitis-c-treatment-cost">extremely pricey drugs treating hepatitis C</a> are only the latest of these. </p>
<p>Lacking even rudimentary price controls, U.S. consumers bore the full brunt of the expensive development work that goes into new drugs. These costs were further augmented by marketing expenditures and profit seeking by all entities within the pharmaceutical supply chain. Consumers in Europe, where there are government-controlled checks on prices, were not as exposed to those high costs.</p>
<p>The Food and Drug Administration has also consistently moved to <a href="https://www.nytimes.com/2018/11/12/upshot/why-prescription-drug-spending-higher-in-the-us.html">relax direct-to-consumer advertising regulations</a>, a practice that is either banned or severely limited in most other advanced nations. While there are limited information benefits to consumers, this <a href="https://www.penguinrandomhouse.com/books/318776/an-american-sickness-by-elisabeth-rosenthal/9780143110859/">practice has certainly increased consumption of high-priced drugs</a>.</p>
<p>Additionally, the overall complexity of the <a href="https://theconversation.com/us-health-care-system-a-patchwork-that-no-one-likes-85252">U.S. health care system</a> and the lack of transparency in the drug supply chain system create conditions favorable to limited competition and price maximization.</p>
<p>All entities in the <a href="https://avalere.com/research/docs/Follow_the_Pill.pdf">pharmaceutical supply chain</a>, including manufacturers and wholesale distributors, have become extremely skilled at finding regulatory loopholes that allow them to maximize profits. This includes, for example, creatively <a href="https://www.penguinrandomhouse.com/books/318776/an-american-sickness-by-elisabeth-rosenthal/9780143110859/">expanding the life of patents</a>, or having them <a href="https://khn.org/news/drugmakers-manipulate-orphan-drug-rules-to-create-prized-monopolies/">recategorized as “orphan drugs” for rare disease to preserve monopolies</a>. So-called pharmacy benefit managers, the middlemen that administer prescription drug programs, add further complexity and often <a href="https://www.statnews.com/2018/08/27/pharmacy-benefit-managers-good-or-bad/">may be driven by profit maximization</a>. </p>
<p>Finally, the U.S. has undergone a series of <a href="https://read.dukeupress.edu/jhppl/article-abstract/40/2/281/13726">coverage expansions</a>, including the prominent creation of the <a href="https://www.cambridge.org/core/journals/journal-of-policy-history/article/inching-toward-universal-coverage-statefederal-healthcare-programs-in-historical-perspective/E94A03DD1F60F9DCBE3DDE9728DA3224">Children’s Health Insurance Program</a>, <a href="https://www.medicare.gov/drug-coverage-part-d">Medicare Part D</a>, and the <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1541-0072.2012.00446.x">Affordable Care Act</a>. For many of the newly covered, this meant access to prescription drugs for the first time and pent-up demand was released. However, it also encouraged pharmaceutical companies to take advantage of the newfound payers for their drugs.</p>
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<h2>Trump’s proposed fixes</h2>
<p>The consequences of pricey pharmaceuticals are significant in terms of costs and diminished health. Close to <a href="https://www.commonwealthfund.org/publications/journal-article/2018/nov/whats-driving-prescription-drug-prices-us">20 percent of adults</a> report skipping medications because they are concerned about costs. Nonetheless, the U.S. may be spending <a href="https://www.healthaffairs.org/do/10.1377/hblog20180726.670593/full/">close to $500 billion annually</a>.</p>
<p>The <a href="https://www.hhs.gov/about/news/2019/01/31/trump-administration-proposes-to-lower-drug-costs-by-targeting-backdoor-rebates-and-encouraging-direct-discounts-to-patients.html">plan proposed by the Trump administration</a> basically replaces an <a href="https://avalere.com/research/docs/Follow_the_Pill.pdf">opaque discount arrangement between drug makers, insurers and middlemen called pharmacy benefit managers</a> with a discount program directly aimed at consumers. Particularly benefiting from the change would be those <a href="https://khn.org/news/winners-and-losers-under-bold-trump-plan-to-slash-drug-rebate-deals/">individuals requiring costly non-generic drugs</a>. Unquestionably, their lives would improve due to increased access and lower costs.</p>
<p>At the same time, costs would be shifted to <a href="https://khn.org/news/winners-and-losers-under-bold-trump-plan-to-slash-drug-rebate-deals/">healthier consumers who do not rely on expensive drugs, as well as those relying on generic versions</a>. Both will be faced with higher overall insurance premiums while not seeing any reductions in the prescription drug bills. That’s because insurers would no longer be able to use drug discounts to hold down premiums.</p>
<p>The Trump administration’s discounting approach, however, is not uncommon. The <a href="https://www.commonwealthfund.org/blog/2016/drug-price-control-how-some-government-programs-do-it">Veterans Health Administration’s has done so quite successfully</a>, obtaining discounts in the range of 40 percent. Likewise, <a href="https://www.commonwealthfund.org/blog/2016/drug-price-control-how-some-government-programs-do-it">Medicaid programs</a> are also using their purchasing power to obtain discounts. And calls for Medicare to negotiate discounts with pharmaceutical companies are common.</p>
<p>The way I see it, there are three major issues inherent in negotiating discounts for drugs. </p>
<p>For one, true negotiations would only take place if Medicare or any other entity was willing to walk away from certain drugs if no discounts could be obtained. In a country that heavily values choice, and where such activities would become a political football, this is highly unlikely. </p>
<p>Moreover, it would only work for drugs where viable alternatives are available. After all, most Americans would likely be hesitant to exclude a drug, even at high costs, when no alternative cure exists.</p>
<p>Yet even if some version of a discount program were to be implemented more widely, such a program does not change the underlying pricing or market dynamics. Crucially, relying on discounts does nothing to reduce list prices set by manufacturers. Pharmaceutical companies and all other entities in the <a href="https://avalere.com/research/docs/Follow_the_Pill.pdf">supply chain</a> remain free to set prices, bring products to the market, and take advantage of loopholes to maximize corporate profits.</p>
<p>Ultimately, pharmaceutical companies and all other entities involved in the pharmaceutical supply chain are unlikely to be willing to simply give up profits. Quite likely, steeper discounts for Medicaid and Medicare may lead to higher costs for employer-sponsored plans. </p>
<h2>Focusing on effectiveness and consumer information</h2>
<p>The question then emerges: What could be done to truly improve the twin issues of high costs and limited cost-effectiveness when comes to pharmaceuticals in the U.S. health care system?</p>
<p>While Americans are often hesitant to learn from other countries, looking to Europe when it comes to pharmaceuticals holds much promise. Countries like <a href="https://www.nice.org.uk/">Britain</a> and <a href="https://www.healthaffairs.org/do/10.1377/hblog20161229.058150/full/">Germany</a> have taken extensive steps to introduce assessments of cost-effectiveness into their health care systems, refusing to pay higher prices for new drugs that do not improve effectiveness of treatment over existing options.</p>
<p>Since reforming its system in the early 2010s, <a href="https://www.healthaffairs.org/do/10.1377/hblog20161229.058150/full/">Germany</a> has allowed manufacturers to freely set prices for a limited period when bringing new drugs to the market. It then uses the data available from that period for a nongovernmental and nonprofit research body to evaluate the benefit provided by the new drug, as compared to existing alternatives. This added benefit, or lack thereof, then serves as the foundation for price negotiations between drug manufacturers and health plans. </p>
<p>While the <a href="https://theconversation.com/us-health-care-system-a-patchwork-that-no-one-likes-85252">legal restrictions and the fragmented nature of the U.S. health care system</a> severely limit the ability of the U.S. to fully translate such a model, in my opinion, the underlying approach bears great value.</p>
<p>Lacking the corporatist nature of the Germany economy, the U.S. should resort to a <a href="https://www.annualreviews.org/doi/abs/10.1146/annurev-publhealth-082313-115826">bottom-up approach</a> focused on investing in assessing and subsequent publicizing of cost-effectiveness data as well as cost-benefit analyses for all drugs. In order to minimize politicization, these analyses would be best handled by one or multiple independent research institutes.</p>
<p>Ultimately, knowing what drugs provide what value would equally benefit consumers, providers, and payers, and serve as a meaningful first step towards connecting the prices we pay for prescriptions to the value we derive from them.</p><img src="https://counter.theconversation.com/content/111256/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Simon F. Haeder is a Fellow in the Interdisciplinary Research Leaders Program, a national leadership development program supported by the Robert Wood Johnson Foundation to equip teams of researchers and community partners in applying research to solve real community problems.</span></em></p>The Trump administration’s proposal to lower drug prices focuses on discounts. A health policy scholar argues that the US could learn from Europe’s system of measuring drug value and effectiveness.Simon F. Haeder, Assistant Professor of Political Science, West Virginia UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1018772019-01-18T11:40:42Z2019-01-18T11:40:42Z3 ways Trump could disrupt health care for the better<figure><img src="https://images.theconversation.com/files/254384/original/file-20190117-32810-11jf9xv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">More data may be key to disrupting health care. </span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/smart-health-care-internet-things-hospital-744180298?src=jvteHRmRzSY9lsl4RBzJ-g-1-4">Zapp2Photo/Shutterstock.com</a></span></figcaption></figure><p>Since his winning presidential campaign, Donald Trump <a href="https://www.cbc.ca/radio/thecurrent/the-current-for-november-10-2016-1.3843974/trump-as-ultimate-political-disruptor-breaking-all-the-rules-to-victory-1.3844016">has been</a> <a href="https://thehill.com/opinion/white-house/411535-donald-trump-the-great-disruptor">repeatedly</a> billed as a disrupter. From trade and <a href="https://www.cnn.com/2018/09/16/world/world-order-under-president-trump/index.html">foreign policy</a> to <a href="https://www.politico.com/story/2018/12/22/trumps-crackdown-hits-legal-immigrants-1039810">immigration</a>, Trump has consistently tried to shake up the status quo. </p>
<p>As <a href="https://scholar.google.com/citations?user=EWB2mpsAAAAJ&hl=en&oi=ao">experts</a> in health care management and policy, we believe the president should now focus his talent for disruption in our sector. </p>
<p>And unlike the issue of <a href="https://www.pbs.org/newshour/politics/trump-says-theres-a-crisis-at-the-border-heres-what-the-data-says">immigration</a>, there is <a href="https://news.gallup.com/poll/223403/americans-hold-dim-view-healthcare-system.aspx?g_source=link_newsv9&g_campaign=item_226607&g_medium=copy">widespread</a> <a href="https://www.kff.org/health-reform/press-release/bipartisan-majorities-support-trump-administrations-push-to-get-drug-prices-in-advertisements-even-after-hearing-counter-arguments/">bipartisan appreciation</a> of the crisis in health care, with <a href="https://www.healthsystemtracker.org/chart-collection/health-spending-u-s-compare-countries/#item-start">bloated costs</a> and an industry that <a href="https://doi.org/10.1377/hlthaff.26.6.1534">fiercely resists change</a>. </p>
<h2>Why health care needs disrupting</h2>
<p>While the growth of health care costs has been relatively muted in recent years, they are still cripplingly high and pose a threat to the entire economy. </p>
<p>Health care <a href="https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/Downloads/ForecastSummary.pdf">now accounts for</a> about 18 percent of the economy – up from <a href="https://www.healthaffairs.org/do/10.1377/hblog20110919.013778/full/">about 13 percent two decades ago</a> – and is expected to make up about a fifth of the U.S. gross domestic product by 2026. The United States spends more on health care than <a href="https://www.doi.org/10.1377/hlthaff.22.3.89">any other country</a>. </p>
<p>Yet Americans have little to show for it. U.S. life expectancy at birth, for example, <a href="https://www.kff.org/slideshow/life-expectancy-in-the-u-s-and-how-it-compares-to-other-countries-slideshow">is lower</a> than 11 other high-income countries including Japan, Germany and the U.K. At the same time, infant mortality <a href="https://www.healthsystemtracker.org/chart-collection/infant-mortality-u-s-compare-countries/#item-infant-mortality-higher-u-s-comparable-countries">is the highest</a>. </p>
<p>In addition, despite the mitigating impact of the Affordable Care Act, <a href="https://www.healthaffairs.org/do/10.1377/hblog20180913.896261/full/">28.3 million remained uninsured in 2018</a>.</p>
<p>Furthermore, rising health care costs <a href="https://www.marketwatch.com/press-release/new-report-shows-the-harmful-effect-rising-health-care-costs-have-on-wage-stagnation-2018-09-04">crowd out other consumer spending</a>, which has the potential to erode Americans’ standard of living. </p>
<p>Here are three ways Republicans and Democrats can come together to disrupt the health sector to reduce costs and improve efficiency. </p>
<h2>1. Let nurses and pharmacists do more</h2>
<p>One of the key drivers of rising health care spending is the <a href="https://www.doi.org/10.1377/hlthaff.22.3.89">high cost of labor</a>. </p>
<p>And one reason for that is state laws and regulations control what <a href="https://jamanetwork.com/journals/jama/article-abstract/198677">medical professionals can and cannot do</a> in a way that requires <a href="https://stats.oecd.org/index.aspx?DataSetCode=HEALTH_STAT&_ga=2.187967080.1163415374.1547405100-1371956472.1547405100">high-paid physicians</a> to perform certain duties or make medical decisions that nurses, pharmacists and others <a href="https://doi.org/10.1377/hlthaff.2014.1367">with more modest salaries</a> could easily do. While the intent may be to ensure quality, the end result of this ring fencing in our view is that it protects certain groups – including nurses and others – from competition. It also ties the hands of health care managers seeking to improve efficiency. </p>
<p>For example, <a href="https://www.forbes.com/sites/adammillsap/2018/06/19/its-time-to-expand-scope-of-practice-laws/#6e2fbc762c64">state scope of practice rules</a> generally restrict prescribing medications to physicians – even though others such as nurse practitioners and pharmacists are fully qualified to do this in most cases. Similarly, ophthalmologists rather than optometrists are primarily allowed to prescribe eye medication, while dental hygienists require the supervision of a dentist. </p>
<p>And as for the impact on quality, a 2013 study showed that the <a href="https://doi.org/10.1016/j.nurpra.2013.07.004">quality, safety and effectiveness of care is similar</a> between less costly nurse practitioners and more costly physicians. </p>
<p>To <a href="https://www.gfrlaw.com/what-we-do/insights/time-reform-corporate-practice-medicine-doctrine">change this</a>, Trump could direct federal regulators to craft guidelines that greatly expand the scope of what nurses, pharmacists, hygienists and the like can do, and then have Medicare and Medicaid make payments to health plans, hospitals and states contingent on compliance with those guidelines. </p>
<p>Increasing competition and letting less well-paid health care professionals handle more of these duties and decisions <a href="https://doi.org/10.1377/hlthaff.2014.1367">should help contain</a> and <a href="https://www.medpagetoday.com/practicemanagement/reimbursement/74505">possibly even lower costs</a>. </p>
<h2>2. End the monopoly on drugs</h2>
<p>Another major culprit behind out-of-control health care inflation is <a href="https://www.communitycatalyst.org/resources/publications/document/2018/CC-PrescripDrugPrices-Report-FINAL.pdf">high prescription drug prices</a>, especially for patented medicines. Most prescriptions are for generic products that are commonly inexpensive, but new drugs often command eye-popping prices.</p>
<p>Studies show <a href="https://www.communitycatalyst.org/resources/publications/document/2018/CC-PrescripDrugPrices-Report-FINAL.pdf">Americans pay at least three times</a> more for drugs than residents of other high-income countries. And a quarter of Americans who take a prescription drug say they skip doses or take fewer pills than they should because of the high cost. </p>
<p>Pharmaceutical firms can charge such high prices for new drugs because patents give them monopoly power for years. Moreover, insurers have been willing to pay. </p>
<p>The Trump administration <a href="https://www.nytimes.com/2018/10/25/us/politics/medicare-prescription-drug-costs-trump.html">has already made an important if narrow move</a> to remedy this by <a href="https://www.healthaffairs.org/do/10.1377/hblog20181026.360332/full/">directing that Medicare Part B</a> use international <a href="http://www.pharmexec.com/international-reference-pricing-us-style">reference prices</a> in some cases when reimbursing pharmaceutical companies. That is, the program would pay the average price of a drug in a basket of countries, which is <a href="https://www.medpagetoday.com/publichealthpolicy/healthpolicy/77258">usually lower</a> than prices in the U.S. A recent government study of the impact estimated the program <a href="https://aspe.hhs.gov/system/files/pdf/259996/ComparisonUSInternationalPricesTopSpendingPartBDrugs.pdf">would have saved more than $8 billion</a> had reference pricing been used in 2016. </p>
<p>But it could do more, particularly as there is <a href="https://www.kff.org/health-reform/press-release/bipartisan-majorities-support-trump-administrations-push-to-get-drug-prices-in-advertisements-even-after-hearing-counter-arguments/">significant bipartisan interest</a> in the issue. </p>
<p>An even bolder approach would involve reforming the patent system underpinning biomedical research. Currently the patent system <a href="https://journals.sagepub.com/doi/abs/10.1177/2168479016648730">provides incentives for biomedical research</a>, with the potential to reap enormous profits. A more efficient way to finance groundbreaking research in our view would be to put a tax on the sale of prescription drugs and use the proceeds to fund research on new ones. </p>
<p>Pharmaceutical and other biomedical companies would compete for those grants – making the decision over what types of drugs to develop a social decision rather than a private one – and any drug they develop with the money would be patent-free. Nobel Prize-winning economist Joseph Stiglitz, for one, <a href="https://opinionator.blogs.nytimes.com/2013/07/14/how-intellectual-property-reinforces-inequality">has argued in favor</a> of an approach similar to this. </p>
<p>In our view, this would drastically reduce prices.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/254414/original/file-20190117-32837-loouc1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/254414/original/file-20190117-32837-loouc1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/254414/original/file-20190117-32837-loouc1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/254414/original/file-20190117-32837-loouc1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/254414/original/file-20190117-32837-loouc1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/254414/original/file-20190117-32837-loouc1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/254414/original/file-20190117-32837-loouc1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Giving consumers of health care more control over their data could curb costs.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/row-multiethnic-people-sitting-side-by-123325801?src=N1RnRbllnp08aqgn84mH9w-1-89">Tyler Olson/Shutterstock.com</a></span>
</figcaption>
</figure>
<h2>3. Put consumers in the driver’s seat</h2>
<p>A third problem that leads to high health care spending is the lack of consumer control. </p>
<p>Normally, when someone wants to buy something – be it groceries or a car – a consumer looks around in stores or online and compares prices to make an informed choice about what works best given her needs and budget. </p>
<p>Health care does not conform to this model. Information is asymmetric —- which means one side knows more than the other —- and consumers tend to defer to their providers. Moreover, insurance renders consumers insensitive to prices with little incentive to shop. Cost containment breaks down if shoppers <a href="https://www.researchgate.net/publication/275023198_Price-Transparency_and_Cost_Accounting_Challenges_for_Health_Care_Organizations_in_the_Consumer-Driven_Era">cannot obtain prices</a>.</p>
<p>Trump could empower consumers by aggressively pushing for greater standardization and use of technology in health care. This could include giving consumers more control of their health records in the cloud and requiring insurers and providers to give them more information about prices and the quality of competing options. And as with occupational control, the administration could condition Medicare and Medicaid payments on following its standards. </p>
<p>Knowledge that all providers have ready access to all your medical information will likely encourage switching to lower cost providers. And just as giving consumers more control <a href="https://hbr.org/2002/07/lets-put-consumers-in-charge-of-health-care">led to significant innovations, competition and savings</a> in retirement plans, the same thing would happen in health care.</p><img src="https://counter.theconversation.com/content/101877/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>I have received funding over the years from the following agencies:
Human Services Research Council in South Africa,
National Library of Medicine,
Centers for Disease Control,
US Department of Education,
Ortho Biotech,
Via Medical,
Agency for Healthcare Policy and Research,
Iowa Hospital Association,
Greater Quad Cities Hospital Council,
Iowa Family Planning Council
Peter Hilsenrath is affiliated with Center for Health Policy and Research, College of Medicine, University of California at Davis. </span></em></p><p class="fine-print"><em><span>I have been PI on grants from the National Cancer Institute and from The Iowa Mental Health Consortium. I’ve worked on projects that were funded primarily by the Healthcare Information Management System Society (including one jointly funded with Siemens) and a project funded by the Iowa Department of Human Services.</span></em></p>The president should use his penchant for shaking up the status quo to tackle the genuine crisis in health care.Peter Hilsenrath, Joseph M. Long Chair in Healthcare Management & Professor of Economics, University of the PacificDavid Wyant, Assistant Professor of Management, The Jack C. Massey Graduate School of Business, Belmont UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/864452017-11-06T01:20:53Z2017-11-06T01:20:53ZHow burnout is plaguing doctors and harming patients<figure><img src="https://images.theconversation.com/files/192284/original/file-20171027-13340-16ejemk.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Exhaustion and burnout among physicians are growing problems. </span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/sad-surgeon-sitting-on-floor-corridor-584310208">wavebreakmedia/Shutterstock.com </a></span></figcaption></figure><p>The presidential symposium at this year’s Annual Meeting of the <a href="https://www.childneurologysociety.org/">Child Neurology Society</a> of America in early October in Kansas City raised many eyebrows. The first presentation of this symposium focused on burnout rates among neurologists around the country. </p>
<p>Many of my colleagues felt that this was an inappropriate choice, especially with so many trainees and young child neurologists in the audience. Typically, the presidential symposium at a conference of such eminence addresses an issue of scientific importance. But some other colleagues felt that this discussion was essential and that the elephant in the room cannot be ignored anymore. </p>
<p>As I sat through it, I felt that the presentation was outright depressing, with speakers belting out dismal data about the state of mind of neurologists around the country. The most striking statistic was that about <a href="https://www.aan.com/PressRoom/Home/PressRelease/1515">60 percent of neurologists in the U.S. were experiencing burnout symptoms</a>, including emotional exhaustion or lack of a sense of accomplishment. They also showed signs of <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3296106/">depersonalization</a>, which is an impaired perception of self and others that can lead to lack of empathy, including for patients. </p>
<p>I have been taking care of patients for more than two decades since graduating from medical school in 1994. I had not even heard of physician burnout until about four years ago when a lot of data started getting <a href="https://www.medscape.com/sites/public/lifestyle/2013">published</a>. However, it is now a subject of discussion among physicians on wards, in clinic and at conferences, as we all realize that it is a menace. </p>
<h2>The core that provides care</h2>
<p>Unsurprisingly, the rot extends beyond the field of neurology. Several reports recently have highlighted that physician burnout rates across many major specialties in the U.S. have reached epidemic proportions. For example, a <a href="https://wire.ama-assn.org/life-career/report-reveals-severity-burnout-specialty">survey</a> earlier this year suggested that the physician burnout rate exceeded 50 percent for the fields of emergency medicine, obstetrics and gynecology, family medicine, internal medicine, critical care, anesthesiology, pediatrics, neurology, urology, cardiology, rheumatology and infectious disease.</p>
<p>This is bad for doctors, and it’s bad for patients. Physician burnout is a public health hazard, because it is <a href="https://psnet.ahrq.gov/perspectives/perspective/190/burnout-among-health-professionals-and-its-effect-on-patient-safety">a danger to patient safety and leads to poorer care</a>.</p>
<p>The presidential symposium got me thinking about my own professional life. Was I positive about my career? What made me continue to pursue the practice of neurology? And, did anyone at work inspire me to remain engaged?</p>
<p>As I reflected on these questions about what helps me avoid burnout, an obvious answer came immediately: I knew that I continually looked up to two senior physicians in my division who trained me to be a child neurologist about a decade ago and now happen to be my colleagues. </p>
<p>But then I realized that there were some others who served as my inspiration at a subconscious level. </p>
<p>One of them is a medical social worker who joined us just a few months back. Imposing in stature, with a crop of curly high-top hairdo that makes him appear even taller, he is at ease when interacting with kids and parents alike. The focus of his work is to provide support to families that are overwhelmed with the care of children with chronic neurological illnesses. I can rely on him to come up with solutions to any of my patients’ problems, whether it is finding mental health support or getting insurance coverage. And he manages to handle an extremely demanding schedule without ever appearing to be hurried. While many of us dread electronic medical record keeping, his notes wondrously manage to not only incorporate precise wordings but also have the most aesthetically pleasing fonts.</p>
<p>The other co-worker who inspires me guards the front desk of our office. He ushers in patients and their families. This may not sound like an important job to laypersons. But he gives a new meaning to the art of making a first impression, the art of putting sick patients and their families at ease. And he does so day in day out with warmth that few can ever manage to radiate. </p>
<p>The four individuals mentioned above have little in common, except that they directly interact with and take good care of patients and their families. </p>
<h2>The superstructure</h2>
<p>At the same time, I, like most doctors across America, have scores of colleagues who never interact with a patient or directly contribute to the actual care. These include billers, coders, financial counselors, accountants, managers, directors, strategists and so on. They play an increasingly critical role in the complex multi-payer health care setup as it operates today. </p>
<p>Unfortunately, the nurses, the therapists, the physicians, the pharmacists, the social workers – the folks who interact with patients and directly contribute to the provision of care – are arguably becoming smaller in their significance within the health care system of America. </p>
<p>The entire industry’s focus seems to have shifted to administration and the business side of medicine. There are data to support this: We spend way more on administrative costs than any other country around the world to deliver care, <a href="http://www.commonwealthfund.org/publications/in-the-literature/2014/sep/hospital-administrative-costs">particularly in the hospital setting</a>. This shift in focus is likely the central cause of burnout.</p>
<p>Can the setup be overhauled or the course be reversed?</p>
<p>My grandfather once risked his life and crossed a flooded river on a horseback to steer a woman in the midst of a complicated labor to safety. He treated the poor free of charge, and he took money from the rich to build a hospital in an area of India where medical care was in short supply. He had nothing much to worry about then, except his conscience.</p>
<p>In 21st-century America, we can’t hope to recreate such a utopian scenario. But we can certainly restructure the health care setup enough to help us restore some of the passion. In my opinion, adopting a <a href="http://www.pnhp.org/facts/what-is-single-payer">single-payer health care system</a> will help cut administrative layers. A majority of physicians in the U.S. support moving to a single-payer model, according to a recent <a href="https://www.usnews.com/news/healthcare-of-tomorrow/articles/2017-08-16/doctors-warm-to-single-payer-health-care">survey</a>.</p>
<p>I offer an additional or an alternative solution, one that will require innovative strategies to implement: Any person engaged in the health care industry in an administrative capacity ought to spend at least 20 percent of time and effort in interacting directly with patients. This will put the patients back in the focus and bring passion back into the field of medicine.</p><img src="https://counter.theconversation.com/content/86445/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jay Desai does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The opening session of a meeting of neurologists focused on a problem plaguing doctors: burnout. Doctors are growing increasingly stressed, and it’s affecting patients, too.Jay Desai, Assistant Professor, University of Southern CaliforniaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/827492017-08-25T01:06:18Z2017-08-25T01:06:18ZGetting rid of junk health insurance policies is just tinkering at the margins of a much bigger issue<figure><img src="https://images.theconversation.com/files/183268/original/file-20170824-8189-p70h1g.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Dissatisfaction with private health insurance policies is growing.</span> <span class="attribution"><span class="source">from shutterstock.com</span></span></figcaption></figure><p>In media interviews and his speech at the <a href="http://iview.abc.net.au/programs/national-press-club-address/NC1706C031S00">National Press Club</a> this week, the Australian Medical Association (AMA) president, Michael Gannon, has spoken out against “junk” health-insurance policies. He said these are “worth nothing more than the paper they’re written on”, and is pushing the federal government to streamline policies so people know what they are buying. </p>
<p>Organisations like <a href="https://www.choice.com.au/money/insurance/health/articles/junk-health-insurance">Choice</a> have detailed the type of private hospital policies that are bad value for consumers. Many of these “junk policies” exclude common procedures such as hip and knee replacements, provide little or no choice about which providers can be used, and effectively mean people must access care in public hospitals. So they do nothing to relieve pressures on the public sector.</p>
<p>The <a href="https://ama.com.au/ausmed/looking-ongoing-value-private-health-insurance">AMA and others</a> are pushing for simplified insurance packages, with products classified as gold, silver and bronze, depending on benefits covered and cost. These would provide clarity on what procedures are included or excluded in the cover, and the level of excess you would pay. </p>
<p>At present, there are some 34 insurers offering more than 20,000 policy products. <a href="https://www.theguardian.com/australia-news/2016/nov/17/market-failure-private-health-insurance-only-worth-it-for-the-pregnant-the-rich-and-the-sick">Experts still say</a> there is market failure and private health insurance is only worth it for the rich, sick and for pregnant women. </p>
<p>The proposal for simplified insurance packages will be tinkering at the margins of the real problem. The government policy underpinning the role of private health insurance in our health-care system is defined in terms of competition, choice and personal responsibility by those with higher incomes, rather than health-care needs, outcomes and even costs.</p>
<h2>Issues with private health insurance</h2>
<p>The affordability of private health insurance is an issue for all Australians. This goes not just to cost but to value (as perceived by the purchaser) and utility, especially for Australians who live outside metropolitan areas where they may not have access to treatment in a private hospital. Australians are <a href="https://theconversation.com/the-debate-were-yet-to-have-about-private-health-insurance-39249">generally happy with Medicare</a> and often question the need for private health cover; some <a href="https://theconversation.com/the-debate-were-yet-to-have-about-private-health-insurance-39249">25%</a> of people don’t use their insurance when they are hospitalised.</p>
<p>Policies are complex, and exclusions have proliferated. This includes such basics as maternity and mental health services, and gaps in cover such as necessary post-operative care. Combined with the need for individuals to analyse the cost impact of financial carrots and sticks such as the <a href="http://www.privatehealth.gov.au/healthinsurance/incentivessurcharges/insurancerebate.htm">Private Health Insurance Rebate</a>, <a href="http://www.privatehealth.gov.au/healthinsurance/incentivessurcharges/lifetimehealthcover.htm">Lifetime Health Cover</a> and the <a href="http://www.privatehealth.gov.au/healthinsurance/incentivessurcharges/mls.htm">Medicare Levy Surcharge</a>, it is impossible for many to make informed choices. </p>
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<p>Overall, consumer and doctor dissatisfaction with private health insurance is growing. This is expressed in <a href="http://www.apra.gov.au/PHI/Publications/Documents/1708-QPHIS-20170630.pdf">declining numbers</a> of people taking out hospital cover. Australians are <a href="http://www.smh.com.au/federal-politics/political-news/crisis-looms-as-australians-look-to-ditch-private-health-insurance-20160916-grichb.html">increasingly concerned</a> insurance companies are interested only in profits. Faced with relentless price increases and diminishing value for money, many are ditching or downgrading their cover. </p>
<p>Many others are merely looking to <a href="http://www.smh.com.au/money/planning/how-to-get-value-from-private-health-insurance-20100823-13ebn.html">evade tax penalties</a> rather than cover their health-care needs. And too often private health-care patients face substantial, unexpected out-of-pocket costs. </p>
<p>In his criticism of junk policies, Gannon is echoing the findings of the <a href="https://www.accc.gov.au/publications/private-health-insurance-reports/private-health-insurance-report-2015-16">Australian Competition and Consumer Commission</a>. It has consistently reported that the complexities and costs of the private health industry drive consumers to lower-priced policies that lack adequate coverage – junk policies, in other words.</p>
<h2>What’s the government doing?</h2>
<p>The insurance funds, with <a href="http://www.smh.com.au/federal-politics/political-news/people-are-getting-angry-health-funds-accused-of-obscene-profits-20170517-gw766p.html">surging profits</a>, seem indifferent to these concerns. The CEO of health insurer NIB, <a href="http://www.abc.net.au/news/2017-08-21/nib-boss-defends-health-insurance-against-junk-accusations/8827068">Mark Fitzgibbon</a>, called the AMA campaign “paternalistic” and an attack on consumer choice. He maintains that “all policies do have a minimum level of cover, it’s a question of where you draw the minimum”.</p>
<p>The Australian government, which is a significant stakeholder in private health care, has been strangely silent on these issues. This year it will pay out <a href="http://www.budget.gov.au/2017-18/content/bp1/download/bp1_bs6.pdf">A$6.5 billion</a> for the private health insurance rebate, while Medicare pays 75% of most services provided in private hospitals.</p>
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Read more:
<a href="https://theconversation.com/the-multi-billion-dollar-subsidy-for-private-health-insurance-isnt-worth-it-76446">The multi-billion-dollar subsidy for private health insurance isn't worth it</a>
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<p>Rising <a href="https://www.theguardian.com/australia-news/2017/jul/05/private-health-insurers-must-do-more-to-arrest-rise-in-complaints-senate-told">consumer complaints</a> led the then health minister, Sussan Ley, to establish the <a href="http://www.health.gov.au/internet/main/publishing.nsf/Content/phmac">Private Health Ministerial Advisory Committee</a> in 2016. This was meant to provide advice on reforms, including developing easy-to-understand categories of insurance, improving transparency, and meeting the specific needs of people living in rural and remote Australia. Despite the pressing need for these reforms, this committee has yet to report.</p>
<p>More transparency about the high variability in <a href="https://johnmenadue.com/lesley-russell-the-impact-of-private-health-insurance-on-equity-and-access-in-specialist-healthcare/">specialist doctors’ fees</a> is also needed, notwithstanding the <a href="https://ama.com.au/media/dr-michael-gannon-radio-national-private-health-insurance">AMA’s objections</a> to this.</p>
<p>Policy analysts and competition experts have <a href="https://www.theguardian.com/australia-news/2016/nov/17/market-failure-private-health-insurance-only-worth-it-for-the-pregnant-the-rich-and-the-sick">consistently pointed out</a> that private health insurance is an ineffective mechanism for transferring funds from healthy young Australians to cover the health-care needs of the sick and elderly. The biggest users of private health care are those aged 60 to 79 and changes to Medicare could provide more efficient and equitable ways to cover their needs. </p>
<p>Addressing this will require <a href="https://www.theguardian.com/australia-news/2016/nov/18/experts-agree-private-health-insurance-is-broken-but-how-can-it-be-fixed">substantive reform</a> and the redirection of the funds currently spent on the private health insurance rebate.</p><img src="https://counter.theconversation.com/content/82749/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Lesley Russell does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The AMA are pushing for simplified insurance packages that would see gold, silver and bronze products offered. This won’t solve the overall problem with private health insurance.Lesley Russell, Adjunct Associate Professor, Menzies Centre for Health Policy, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/818342017-08-04T03:50:01Z2017-08-04T03:50:01ZGreg Hunt’s plan to reduce hospital admissions won’t work if he can’t measure successes and failures<p>The controversial issue of hospital funding will be up for discussion again today as state health ministers meet at the <a href="http://www.coaghealthcouncil.gov.au/Announcements/Meeting-Communiques1">COAG Health Council</a>. Earlier this week, <a href="http://www.theaustralian.com.au/national-affairs/health/rewards-to-reduce-crush-in-hospitals/news-story/6cfb38600f3c136c7099e97b841bc19c">The Australian newspaper reported</a> the federal health minister, Greg Hunt, might consider a ten-year funding deal with the states, rather than the normal five-year agreement. But this would depend on states agreeing to some of his proposals to reduce unnecessary spending and improve outcomes.</p>
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<p>These proposals are questionable. Hunt’s plan is reportedly to pay GPs for preventing chronically ill patients being hospitalised and to fine hospitals for re-admissions that could have been avoided. Deciding who gets the carrots and who gets the sticks is a brave endeavour. Even with the best evidence, attributing an “avoidable” hospitalisation to care provided by either GPs or hospitals overlooks patient co-operation. </p>
<p>Will GPs be paid for advising patients to reduce drinking, quit smoking and eat more healthily even if the patient ignores them and becomes yet another heart attack admission to hospital? Will the hospital’s legal expenses be paid when a patient who should be re-admitted isn’t because of scolding accountants? </p>
<p>And, most importantly, it’s unclear who will make these determinations and how “better outcomes” can be be measured. This is because it is impossible at the moment to measure the outcomes of health care in Australia.</p>
<h2>Information all over the place</h2>
<p>That’s not to say we don’t have data. <a href="https://academic.oup.com/intqhc/article-lookup/doi/10.1093/intqhc/mzr004">Data exist</a> for care provided by hospitals, GPs, specialists and allied health professionals, but in separate patient information systems and clinical registries – or both. To measure the outcomes, all this care must be compiled and assessed together, using reliable data. </p>
<p>In the hospital system, each state and territory is responsible for data collection. Clinical coders are employed to work with <a href="http://meteor.aihw.gov.au/content/index.phtml/itemId/181162">national minimum data sets</a> and <a href="https://www.accd.net.au/Icd10.aspx">standard classifications</a>. But coders can only work with the information doctors and nurses provide, and <a href="http://search.informit.com.au/fullText;dn=279243523881251;res=IELHEA">limitations of missing</a> <a href="http://journals.sagepub.com/doi/pdf/10.1177/1833358317721305">hospital data</a> are <a href="http://journals.sagepub.com/doi/pdf/10.1177/1833358316678957">well documented</a>. Hospital collections are funded by governments and costs are included in annual budgets.</p>
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<a href="https://theconversation.com/new-proposed-health-data-report-misses-many-of-the-marks-73517">New proposed health data report misses many of the marks</a>
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<p>When it comes to general practice, there is no mandatory routine data collection. Medicare has information about attendance patterns, visit frequency and GP service items, but no details about the content of these visits – such as what conditions were managed or how each was managed. </p>
<p>Practices operate in silos, keeping their own records about their own patients. As with hospitals, patients may receive care from different practices, creating multiple records for the same individual in multiple facilities.</p>
<p>Given 87% of Australians <a href="https://ses.library.usyd.edu.au/bitstream/2123/15482/5/9781743325162_ONLINE.pdf">visited a GP</a> at least once in 2015-16, why there is no publicly funded, routine data collection is a good question. The Bettering the Evaluation and Care of Health (<a href="http://sydney.edu.au/medicine/fmrc/beach/">BEACH</a>) program actively collected nationally representative data from GPs for <a href="https://ses.library.usyd.edu.au/bitstream/2123/15482/5/9781743325162_ONLINE.pdf">18 years</a>. But the program lost funding in 2016 and data collection ceased, although the BEACH data are still <a href="http://sydney.edu.au/medicine/public-health/research/beach.php">current and available</a>.</p>
<h2>Electronic health records</h2>
<p>Collecting data from GPs’ electronic health records seems a practical solution. It’s timely, cost-effective and, with data-extraction tools available, should be reasonably simple. The National Prescribing Service (NPS) is using this method in its <a href="https://www.nps.org.au/medicine-insight">MedicineInsight</a> project, to produce data for quality improvement (for practices) and for aggregated data to inform government policy.</p>
<p>However, producing valid, reliable data from these records is anything but simple. Only about 71% of GPs have completely <a href="https://ses.library.usyd.edu.au//bitstream/2123/13765/4/9781743324530_ONLINE.pdf">paperless patient records</a>. The rest use a mix of electronic and paper records (25%) or paper records only (4%), which influences how representative the data may be. </p>
<p>Unlike research projects with clear participant denominators, the <a href="http://www.publish.csiro.au/PY/PY14071">number of patients will differ</a> depending on which day a data extraction is performed and the definition used to identify current patients.</p>
<p>There’s no regulation of GPs’ electronic health records. GPs use about eight different software products, but there are no nationally agreed and implemented standards for these. They have different data structures, terminology and classification systems (or none) and different data elements, labels and definitions. </p>
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Read more:
<a href="https://theconversation.com/money-given-to-gps-from-ending-the-medicare-rebate-freeze-should-target-reform-76778">Money given to GPs from ending the Medicare rebate freeze should target reform</a>
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<p>There’s <a href="http://ahha.asn.au/system/files/docs/publications/deeble_institue_issues_brief_no_18.pdf">no standardised minimum data</a> set to specify what data should be recorded at every patient encounter. There are no data links between conditions and the management actions taken. </p>
<p>Links are crucial for managing outcomes. For instance, how can you assess care provision for diabetes if the care and condition aren’t linked in the records?</p>
<h2>The problem of missing data</h2>
<p>As with hospital collections, missing data are a problem. Extraction tools cannot extract what isn’t in the record. The absence of some data elements is easy to identify, such as a blank “age” field. But if a diagnosis, medication or test order is not entered, there’s no way to tell it’s missing. </p>
<p>Test results are also easy to miss. While there is a standard messaging language for <a href="http://www.hl7.org.au/">health systems</a>, its use isn’t mandatory. Many practices receive results by email or paper, scan and attach them, rather than directly populating the appropriate fields in the record.</p>
<p>The few published studies from MedicineInsight <a href="http://www.phcris.org.au/phplib/filedownload.php?file=/elib/lib/downloaded_files/conference/presentations/8147_conf_abstract_.pdf">acknowledge the limitations</a> of data completeness and accuracy in the electronic health records. The frustrations the researchers must be experiencing is justified given the number of years of calls to introduce standards to resolve these problems.</p>
<p>The true measurement of outcomes needs a system-wide approach, starting with a person-based health record that includes standardised data from all health providers. We are a long way from having reliable evidence to support the carrot-and-stick decisions being proposed.</p><img src="https://counter.theconversation.com/content/81834/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Joan Henderson was a member of the BEACH research team from 1999 until the program ceased in July 2016.</span></em></p>A plan to fine hospitals for avoidable hospitalisations and pay GPs to prevent them has many issues. The main problem is that it’s impossible to measure the outcomes of health care in Australia.Joan Henderson, Senior Research Fellow (Honorary)., University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/789712017-06-29T23:50:33Z2017-06-29T23:50:33ZWhy market competition has not brought down health care costs<figure><img src="https://images.theconversation.com/files/176312/original/file-20170629-11567-1rf25h9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Decreased regulation has failed to reduce the growing administrative burden of health care. </span> <span class="attribution"><span class="source">Valeri Potapova/Shutterstock.com</span></span></figcaption></figure><p>It is easier than ever to buy stuff. You can purchase almost anything on Amazon <a href="https://www.amazon.com/gp/help/customer/display.html?nodeId=468480">with a click</a>, and it is only slightly harder to find a place to stay in a foreign city on Airbnb. </p>
<p>So why can’t we pay for health care the same way? </p>
<p><a href="http://www.pnhp.org/sites/default/files/docs/2012/Dollars%20and%20Sense.pdf">My research into the economics of health care</a> suggests we should be able to do just that, but only if we say goodbye to our current system of private insurance – and the heavy administrative burden that goes along with it. <a href="https://theconversation.com/republican-health-care-bills-defy-the-partys-own-ideology-80175">Republican efforts</a> to repeal the <a href="https://theconversation.com/us/topics/affordable-care-act-13354">Affordable Care Act</a> (ACA) would take us in the wrong direction. </p>
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<img alt="" src="https://images.theconversation.com/files/176314/original/file-20170629-5317-1vbuf4y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/176314/original/file-20170629-5317-1vbuf4y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/176314/original/file-20170629-5317-1vbuf4y.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/176314/original/file-20170629-5317-1vbuf4y.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/176314/original/file-20170629-5317-1vbuf4y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/176314/original/file-20170629-5317-1vbuf4y.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/176314/original/file-20170629-5317-1vbuf4y.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Senate Majority Leader Mitch McConnell, middle, on June 27 announced he was delaying a vote on the Republican health care bill.</span>
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<h2>What makes health care so complicated</h2>
<p>In a way, the reason buying health care is different than shopping for a garden gnome or short-term apartment seems obvious. Picking the right doctor, for example, involves a lot more <a href="https://web.stanford.edu/%7Ejay/health_class/Readings/Lecture01/arrow.pdf">anxiety and uncertainty</a> and concerns matters of life and death. </p>
<p>But that’s not really the reason we can’t purchase health care the same way we <a href="http://www.cnn.com/2017/03/07/politics/jason-chaffetz-health-care-iphones/">buy an iPhone</a>. In 1969, this would almost be true (for a rotary phone anyway). Back then, the bill for a birth in a New Jersey hospital <a href="http://www.latimes.com/business/la-fi-healthcare-watch-bills-20150323-story.html">looked a lot like the receipt</a> you’d get for buying pretty much anything else: customer name, amount and a box to be checked for payment by check, charge or money order. </p>
<p>Today, paying for even the simplest office visit <a href="https://www.uta.edu/faculty/story/2311/Misc/2013,2,26,MedicalCostsDemandAndGreed.pdf">can become a nightmare</a>, requiring insurance preauthorization, reimbursements adjusted for in-network or out-of-network copays and deductibles and the physician “tier” (or how your prospective doctor is evaluated for cost and quality by the insurance company). </p>
<p>Prescriptions require even more authorizations, while follow-up care necessitates coordinated review – and it goes without saying that many forms will have to be completed. And this doesn’t end when you arrive at the doctor’s office. A large chunk of any visit is spent with a beleaguered nurse, or even the physician, filling out a required checklist of insurance-mandated questions.</p>
<p>The growing complexity of health care finance explains why it’s becoming more and more expensive even though there has been <a href="http://www.nejm.org/doi/full/10.1056/NEJMp0910064#t=article">little or no improvement in quality</a>. Since 1971, the share of our national income spent on health care <a href="https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsProjected.html">has doubled</a>.</p>
<p>We can blame a significant part of the soaring cost of health care on the ever-increasing burden of administrative complexity, whose cost <a href="https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsHistorical.html">has climbed at a pace of more than 10 percent a year</a> since 1971 and now consumes over 4 percent of GDP, up from less than 1 percent back then. </p>
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<h2>Lemons and cherries</h2>
<p>So if the rising cost of administration is a primary force driving health care inflation, why don’t we do something about it? </p>
<p>That’s because administrative complexity and waste are no accident but rather are baked into our private health insurance system and made worse by continuing attempts to use competitive market processes to achieve social ends other than maximizing profit. </p>
<p>Paying a doctor was relatively simple in the 1960s. <a href="https://books.google.com/books/about/The_Blues.html?id=LGE7OAAACAAJ">Most people had the same insurance policy</a>, issued by Blue Cross and Blue Shield, which back then was a private company but operated like a non-profit under strict regulation.</p>
<p>But in hopes of controlling steadily rising costs, policymakers encouraged insurers besides Blue Cross to enter health insurance markets, beginning with the <a href="https://healthcare.uslegal.com/managed-care-and-hmos/the-hmo-act-of-1973/">HMO Act of 1973</a>. The proliferation of for-profit companies with competing plans raised billing costs for health care providers, which now had to submit claims to a multitude of different insurers, each with its own codes, forms and regulations. </p>
<p>Not only that, but insurers quickly <a href="https://meps.ahrq.gov/data_files/publications/st497/stat497.pdf">discovered the dirty secret of health care finance</a>: Sick people are expensive and make up most costs, while healthy people are profitable. </p>
<p>In other words, the vital lesson for an insurer looking to make money is to identify the few sick people and get them to go away (“<a href="http://frugalfamilydoctor.blogspot.com/2013/06/cherry-picking-and-lemon-dropping.html">lemon dropping</a>”) and find the healthy majority and do things that attract them to your plan (“<a href="https://clearhealthcosts.com/blog/2016/11/doctors-point-view-payments-cherry-picking-lemon-dropping/">cherry picking</a>”). </p>
<p>Insurers are happy to offer discounts on <a href="http://www.aetna.com/employer/commMaterials/documents/Roadmap_to_Wellness/fitness-reimbursement-member-postenroll-flyer-hcr.PDF">fitness club memberships</a> to attract healthy people, for example. But they punish the sick with <a href="http://www.kff.org/health-costs/press-release/average-annual-workplace-family-health-premiums-rise-modest-3-to-18142-in-2016-more-workers-enroll-in-high-deductible-plans-with-savings-option-over-past-two-years/">higher copays and deductibles</a>, as well as increasingly restrictive and intrusive regulations on preauthorization.</p>
<p><a href="http://www.nber.org/papers/w6107">Economists call it adverse selection</a>. Regular people call it paperwork hell. Whatever the name, it’s the purpose of increasingly complicated insurance plans and reimbursement forms.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/176315/original/file-20170629-2996-1mhmzw3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/176315/original/file-20170629-2996-1mhmzw3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/176315/original/file-20170629-2996-1mhmzw3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/176315/original/file-20170629-2996-1mhmzw3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/176315/original/file-20170629-2996-1mhmzw3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/176315/original/file-20170629-2996-1mhmzw3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/176315/original/file-20170629-2996-1mhmzw3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Insurers use ‘lemon dropping’ and ‘cherry picking’ to control costs.</span>
<span class="attribution"><span class="source">uoucheg/Shutterstock.com</span></span>
</figcaption>
</figure>
<h2>A failure to fix</h2>
<p>The public and government authorities figured this out quickly, but too often the cures have been as bad as the disease. </p>
<p>We could, and I believe should, have abandoned the use of for-profit private insurance to adopt a <a href="http://www.pnhp.org/facts/what-is-single-payer">simple single-payer system</a>, in which a government agency would provide coverage to everyone in the U.S. Instead, in forging the ACA and in every other health reform enacted in the past 40 years, <a href="http://www.nytimes.com/2010/03/21/health/policy/21health.html?mcubz=0">policymakers decided to work with private insurance</a> while trying to fix some of its evils. </p>
<p>We <a href="https://archive.hhs.gov/news/press/1999pres/990412.html">adopted the “Patient’s Bill of Rights”</a> around the turn of the century and created processes to allow patients and providers to appeal medical decisions made by insurers. State health commissioners now have considerable power to supervise insurers, while the ACA <a href="https://www.healthcare.gov/glossary/essential-health-benefits/">mandates certain essential benefits</a> be provided in all insurance plans.</p>
<p>Yet each of these efforts to protect the sick from abuses inherent in the for-profit insurance system only added to the administrative burden, and the costs, on the entire industry. </p>
<p>Some perceived the problem as a lack of market competition so <a href="http://content.healthaffairs.org/content/16/1/142.abstract">governments freed hospitals</a> and other health care providers from regulations on prices and restrictions on mergers, advertising and other practices. Far from reducing administrative complexity or lowering prices, research has shown that <a href="http://www.sciencedirect.com/science/article/pii/S0148296301003095">deregulation made both problems worse</a> by allowing the formation of networks of hospitals and providers who use advertising and other business and financial practices to control markets and stifle competition.</p>
<p>Simply put, each attempt to fix a <a href="http://www.sciencedirect.com/science/article/pii/S0148296301003095">problem</a> has led to more administration because we have kept intact the system of private health insurance – and for-profit medicine – that is <a href="https://www.bostonglobe.com/opinion/2012/06/21/years-later-weld-deregulation-hospital-rates-looms-large-root-today-cost-crisis-weld-action-root-health-care-cost-crisis/x8RD0if5Mhgoooq5A4ZYmK/story.html">at the root of at the dual problems of rising health care costs</a> and <a href="http://www.fiercehealthcare.com/finance/place-blame-for-high-hospital-prices-squarely-deregulation">growing complexity</a>. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/176313/original/file-20170629-11661-398jad.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/176313/original/file-20170629-11661-398jad.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=412&fit=crop&dpr=1 600w, https://images.theconversation.com/files/176313/original/file-20170629-11661-398jad.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=412&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/176313/original/file-20170629-11661-398jad.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=412&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/176313/original/file-20170629-11661-398jad.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=517&fit=crop&dpr=1 754w, https://images.theconversation.com/files/176313/original/file-20170629-11661-398jad.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=517&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/176313/original/file-20170629-11661-398jad.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=517&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A growing share of Americans support switching to a single-payer health care system.</span>
<span class="attribution"><span class="source">AP Photo/Rich Pedroncelli</span></span>
</figcaption>
</figure>
<h2>It’s time to take a step back</h2>
<p>Clearly, our experiment in market-driven health care has gone awry. </p>
<p>Before we introduced competition and deregulation into health care, things were relatively simple, with <a>most revenue going to providers</a>. <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3024588/">We could save a lot of money</a> if we went backwards and adopted a single-payer system like Canada’s, where insurers do not engage in systematic preauthorization or utilization review and hospitals and pharmaceutical companies do not form monopolies to profit at the expense of the public. </p>
<p>Largely by reducing administrative costs within the insurance industry and to providers, a single-payer program could save enough money to <a href="http://www.pnhp.org/sites/default/files/Funding%20HR%20676_Friedman_7.31.13_proofed.pdf">provide health care to all Americans</a>.</p>
<p>Compared with Canada’s single payer system, American doctors and hospitals <a href="http://www.nejm.org/doi/full/10.1056/NEJMsa022033#t=article">have nearly twice as many administrative staff workers</a>. </p>
<p>So whether the ACA remains in force or it’s replaced by something else, I believe we won’t be able to control health costs – and make health care affordable for all Americans – until we revamp the system with <a href="http://time.com/money/4733018/what-is-single-payer-healthcare-system/">something like single payer</a>.</p><img src="https://counter.theconversation.com/content/78971/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Gerald Friedman belongs to the Massachusetts Society of Professors (a National Education Association affiliate) and Democratic Socialists of America. He has done some consulting work for the Vermont State Employees and has written reports on single-payer plans for several states, including Maryland, Pennsylvania and New York. </span></em></p>GOP lawmakers say their bills to replace the Affordable Care Act would do a better job than the ACA of controlling rising health care costs, but 40 years of deregulation show it just won’t work.Gerald Friedman, Professor of Economics, UMass AmherstLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/675292016-10-26T03:24:08Z2016-10-26T03:24:08ZHere’s how the next president could work with Congress to fix Obamacare<p>As we all know by now, The Donald <a href="https://theconversation.com/could-the-candidates-truly-fix-or-nix-obamacare-six-essential-reads-67353">wants to repeal and replace</a> the Affordable Care Act while <a href="https://theconversation.com/could-the-candidates-truly-fix-or-nix-obamacare-six-essential-reads-67353">Hillary wants to fix it</a>. But what does that mean, and how would they do it?</p>
<p>The first question is what exactly do they want to repeal or fix. The ACA seems to have evolved into a great political Rorschach test somewhat devoid of real content but relying on projection of underlying beliefs.</p>
<p>For Republicans, it is evidence of governmental overreach and excess expenditures, while Dems seem to think of it as the essence of collective action and shared responsibility for those less fortunate. As such, neither informs the specific directions we might take from here.</p>
<p>In reality, the <a href="http://www.healthline.com/health-slideshow/most-important-aspects-of-the-affordable-care-act">ACA </a>consists of four major parts: </p>
<ol>
<li>Expansion of Medicaid for low-income working poor, with mostly federal financing.</li>
<li>Research on alternative ways to treat conditions to inform physician practice.</li>
<li>Tests of innovative ways to organize and deliver health care for better value that can be quickly implemented across the system. </li>
<li>The exchanges, for purchasing subsidized individual policies from private insurance companies.</li>
</ol>
<p>Of course, it is mainly the exchanges that get public attention and, unfortunately, much of that is misinformed. And even if the candidates were to change or eliminate the exchanges, the other three parts, which may well be the most important and lasting legacy of the legislation, would most likely stand.</p>
<h2>Medicaid madness?</h2>
<p>The easiest part of the ACA was thought to be the <a href="https://www.medicaid.gov/medicaid/program-information/downloads/modified-adjusted-gross-income-and-medicaid-chip.pdf">expansion of Medicaid to the working poor</a>, but it became a political battle. Medicaid expansion cuts states’ health care costs while providing coverage to millions more people.</p>
<p>The expansion required <a href="http://healthaffairs.org/blog/2016/03/21/the-economics-of-medicaid-expansion/">no expenditure of state money for the first three years</a>, only an acceptance of federal dollars. Thus, many considered expansion a done deal and a crucial part of the law. Then the U.S. Supreme Court <a href="http://www.scotusblog.com/2012/06/court-holds-that-states-have-choice-whether-to-join-medicaid-expansion/">ruled that states could refuse </a>to expand Medicaid.</p>
<p>Many – 26, to be precise – did just that in 2014, as Republican governors and lawmakers in red states voted to not accept the federal money. Some later changed their minds, but as of now, <a href="http://kff.org/health-reform/slide/current-status-of-the-medicaid-expansion-decision/">19 states still have not expanded Medicaid</a>.</p>
<p>Even some<a href="http://politics.blog.ajc.com/2016/08/31/georgia-chamber-pitches-conservative-friendly-blueprint-for-medicaid-expansion/"> red state governors</a> who resisted the extra funds from the Feds to expand Medicaid coverage are reconsidering, albeit with some conditions that provide political cover. Only states’ rights advocates, for philosophical reasons, and budget hawks, who fear that the Feds will renege on their funding, are holding out for a repeal of this one.</p>
<h2>Beyond the exchanges</h2>
<p>While the double-digit premium increases have led to calls for repeal, it’s important to look at the law more broadly and what can be done to fix it.</p>
<p>Two parts of the ACA <a href="https://www.cms.gov/apps/files/aca-savings-report-2012.pdf">may have dramatic impact </a>even though they totally avoid public scrutiny. They seek to change the way that health care is delivered at a very fundamental level. Research <a href="http://obamacarefacts.com/summary-of-provisions-patient-protection-and-affordable-care-act/">called for by the ACA</a> is being done by health care systems, insurers, and provider at every level, focusing on alternative ways to treat problems – something that most would assume we already do. Under the law, <a href="https://www.ncbi.nlm.nih.gov/books/NBK241388/">reimbursements to providers</a> is tied to their doing this.</p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/143156/original/image-20161025-4735-j1bu93.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/143156/original/image-20161025-4735-j1bu93.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=659&fit=crop&dpr=1 600w, https://images.theconversation.com/files/143156/original/image-20161025-4735-j1bu93.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=659&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/143156/original/image-20161025-4735-j1bu93.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=659&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/143156/original/image-20161025-4735-j1bu93.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=828&fit=crop&dpr=1 754w, https://images.theconversation.com/files/143156/original/image-20161025-4735-j1bu93.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=828&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/143156/original/image-20161025-4735-j1bu93.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=828&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The FDA approves drugs in the U.S. Via Shutterstock.</span>
<span class="attribution"><a class="source" href="http://www.shutterstock.com/pic-133102730/stock-photo-prescription-pill-bottle-spilling-pills-on-to-surface-isolated-on-a-white-background.html?src=YqWfTo13h1Xrijxg-_OdAQ-1-16">From www.shutterstock.com</a></span>
</figcaption>
</figure>
<p>But that’s not really the case. For example, the <a href="http://www.fda.gov/Drugs/DevelopmentApprovalProcess/">FDA is charged with assuring that a drug</a> or device is effective (efficacious) and safe (not toxic or carcinogenic), not whether it is actually better than the alternative. So we have alternative drugs, devices, surgeries and so forth that all address a problem with little guidance as to which one actually is better. </p>
<p>The idea is that scientific findings will guide both <a href="http://obamacarefacts.com/summary-of-provisions-patient-protection-and-affordable-care-act/">physician practice and coverage decisions</a> toward better value and blunt that drive toward more marginal treatment at ever higher cost with limited outcomes. </p>
<p>The alternative approach to this kind of cost control is just to <a href="https://hbr.org/2014/11/how-not-to-cut-health-care-costs">cut payments, while allowing volume to expand</a>. It is unlikely that those who support cost control and those who do not will want to proceed down that path. It will lead to bankruptcy and ever declining marginal value – although those who stand to lose money may resist.</p>
<p>In a similar way, the Innovation Center <a href="https://www.cms.gov/apps/files/aca-savings-report-2012.pdf">called for in the ACA </a>is designed to try new organizational and payment models to see what works better and encourage adoption widely. The goal here is “value,” where that is defined as something that meets at least threshold quality metrics (e.g., hospital readmission rates) while meeting or beating actuarial estimates of cost.</p>
<p>The only ones who are arguing against these two little known parts of the act are those whose vested interests would be challenged. Drug companies are not wild about the additional standards of value for their products; hospitals argue the quality metrics are faulty, and physicians don’t like being forced into new organizations that may limit their autonomy. </p>
<p>Big bets have been made on the future of health care, and these cannot be recalled easily. But there are places here that will likely be part of Hillary’s “fixing” of the ACA.</p>
<h2>And then there are marketplaces</h2>
<p>So that leaves us with the “disaster” of the individual insurance markets decried by Trump, who has said he would eliminate the marketplaces in favor of open competition across state lines. Allowing insurance companies to offer insurance in different states, the thinking goes, will increase competition of plans and lower rates for consumers. </p>
<p>Unfortunately, the companies don’t seem interested <a href="http://www.rwjf.org/content/dam/farm/reports/issue_briefs/2012/rwjf401409">since they already can do this to some extent</a> but don’t. One reason is that premiums are based, in part, on <a href="http://www.rwjf.org/content/dam/farm/reports/issue_briefs/2012/rwjf401409">negotiated rates with providers</a>. It is hard to build provider networks in another state, from another state. </p>
<p><a href="http://healthaffairs.org/blog/2013/03/06/no-competition-the-price-of-a-highly-concentrated-health-care-market/">The level of competition insurers face is secondary</a> and may be a detriment in driving provider rates lower. </p>
<p>In any event, cross-border competition hardly is a panacea for rising costs. It is, however, an unspoken attack on the insurers as a way to break their often solid capture of the regulation process which now resides at the state level. Thus, expect industry resistance to this traditional Republican proposal.</p>
<p>The problems of the individual insurance exchanges come from many directions. Besides insurance company pricing errors compounded by their natural risk avoidance, the government changed the rules midstream and limited the range of premiums insurers can charge, which forced the young to pay too much or the old too little. </p>
<p>This was compounded by a <a href="https://theconversation.com/whats-ailing-the-aca-insurers-or-congress-64151">huge failure of Congress to hold up their end of the bargain</a> in supporting the transitional support promised by the law to companies willing to take the plunge into the unknown of the exchanges, as I wrote about in The Conversation in August. When<a href="https://theconversation.com/whats-ailing-the-aca-insurers-or-congress-64151"> only 12 percent of the support </a>promised to companies with higher than expected costs was paid, the higher risk and big losses drove many out of the markets. Thus, many of the problems of the exchanges lie directly at the feet of Congress. </p>
<p>A Democratic Congress would rectify this as part of the fix. Hillary also<a href="http://www.forbes.com/sites/brucejapsen/2016/05/15/hillarys-medicare-buy-in-could-replace-vanishing-retiree-coverage/#52a3a52a45eb"> would allow people in the 55-64-year-old age</a> group to buy into Medicare early. This is a form of the <a href="http://www.factcheck.org/2009/12/public-option-vs-single-payer/">“public option”</a> that would be popular and probably would enliven the areas where there is no competition on the exchanges. </p>
<p>The irony of the Republican opposition to the use of a competitive market with subsidies to make health insurance “affordable” – essentially their long time alternative – might become apparent, allowing them to engage in fixing the ACA if Congress goes blue.</p>
<p>Interestingly, Clinton has a number of <a href="http://time.com/money/4327009/hillary-clinton-medicare-proposal-3-questions/">other positions </a>that one could argue would move us toward lower cost and higher quality as promised by the ACA. One of the most interesting concerns <a href="https://www.hillaryclinton.com/briefing/factsheets/2016/09/02/hillarys-plan-to-respond-to-unjustified-price-hikes-for-long-available-drugs/">drugs</a>, where she would allow Medicare to bargain for lower prices, permit importation of price-controlled prescription pharmaceuticals from other countries and limit direct-to-consumer advertising. </p>
<p>Given that this is the <a href="http://healthaffairs.org/blog/2015/08/31/rising-cost-of-drugs-where-do-we-go-from-here/">most inflationary of any sector of health care </a>and that many firms seem to have engaged in exploitative pricing, these are likely to get attention from both sides of the aisle although Republicans have said little about their approach.</p>
<p>So overall, it is unlikely that we would actually see a full “repeal and replace” from the GOP. There are some signs that Congress is open to fixing the ACA, as evidenced by a few Republicans, such as Rep. <a href="http://www.bloomberg.com/politics/articles/2016-08-23/clinton-win-could-pressure-gop-to-heal-not-repeal-obamacare">Dennis Ross of Florida</a>. Realistically, in their weakened position should Trump lose, compromise is more likely than in any time during the last eight years. </p>
<p>The fact that the ACA actually has <a href="http://www.usnews.com/opinion/economic-intelligence/2014/06/20/cbo-confirms-obamacare-reduces-deficits">reduced the deficit</a>, although estimates vary by how much, and <a href="http://www.forbes.com/sites/brucejapsen/2016/10/23/hillarys-right-obamacare-reduces-medicare-spending/#6484d47666ab">extended Medicare solvency</a> by many years may mean that wholesale changes would not be good. It would be important to keep those parts that have saved money. And both sides have pledged their allegiance to both of these politically popular objectives.</p>
<p>Going forward, the most likely path is the same difficult one that the U.S. system as a whole must take toward improving access and value. There will be no quick fix.</p><img src="https://counter.theconversation.com/content/67529/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>JB Silvers is affiliated with MetroHealth Medical Center, Cleveland (board).</span></em></p>Double-digit premium increases are leading to an outcry that the Affordable Care Act is not working, yet parts of it are. Here’s what works, and ideas on how to fix what doesn’t.J.B. Silvers, Professor of Health Finance, Case Western Reserve UniversityLicensed as Creative Commons – attribution, no derivatives.