Public Plan Basics & Health Insurance Companies Use Recision to Reject Life Saving Operations

Public Plan Basics & Health Insurance Companies Use Recision to Reject Life Saving Operations

Health Reform: The Fateful Moment

By Theodore R. Marmor, Jonathan Oberlander

Critical: What We Can Do About the Health-Care Crisis

by Senator Tom Daschle, with Scott S. Greenberger and Jeanne M. Lambrew

Thomas Dunne/St. Martin's, 226 pp., $23.95

When the President Obama Healthcare Plan is explained to voters, the public support increases substantially, but rarely noted by the corporate press/media. Explaining the plan really helps in increasing voter acceptance of change. In order for the health reform to really work all the components mentioned by the President needs to be included. The link below to Tom Daschle's book Critical Care book review by the National Review of Books explains in detail why we need reform.

Medicare will cost senior much more money in the future because too many procedures are more for profit or doctors and hospitals than improving the health of their patients. Yes, some doctors are very greedy.

In McAllen, Texas where it is very difficult to sue doctors, the cost to Medicare is double the national average even thought the poor senior Latinos don't have the usual large number of heart disease cases because of their diet. In El Paso with the same demographics and people, the cost to Medicare is half that of that of McAllen a short distance away. The doctors in McAllen are in the business of making lots of money, not giving patients the best care. Overtreatment has been shown not to improve results and often results in poor outcomes and even deaths. Many infections occur from catheters. (New Yorker, June 1, 2009)

I hope you will either phone or see your congress person or your senator when they visit your home town. The number one goal of congress and the senators is to get re-elected. So if only angry misinformed people harangue. http://www.votesmart.org .

Jim Kawakami, July 30, 2009, http://jimboguy.blogspot.com

... The strongest case for a public plan that will protect Americans from insurance industry abuses has been made, ironically, by the industry itself. In congressional testimony on June 16, insurance industry executives from WellPoint, UnitedHealth Group, and Assurant refused to end a controversial practice known as "rescission." Under rescission, insurers retroactively cancel—often on the basis of dubious claims that policyholders haven't disclosed their complete health histories—the coverage of those who develop expensive medical conditions. That has left many people with costly medical bills for treatments that had been previously authorized by their insurance.

As Lisa Girion reported in the Los Angeles Times, the three insurers that were included in the June 16 hearing "canceled the coverage of more than 20,000 people, allowing the companies to avoid paying more than $300 million in medical claims over a five-year period." In doing so they sought to avoid paying for the treatment of "policyholders with breast cancer, lymphoma and more than 1,000 other conditions."[4] Lisa Girion, "Health Insurers Refuse to Limit Rescission Insurance Coverage," Los Angeles Times, June 17, 2009.

There is no stronger indictment of American private insurers or better example of the profit motive's corrosive influence on medicine than rescission. That insurers, even with political pressure for reform, would not forswear this practice in public hearings is stunning. It also illustrates how difficult a task it will be to transform the business practices of an industry that profits from discriminating against sick people. ...

Although there are good reasons to want a public plan that will not engage in such behavior, the risks should also be clear. It is quite possible that such a public plan would attract higher-risk enrollees, driving up its costs and sapping its political support. In theory, this problem could be solved by a federal insurance system that would pay more to insurers who enroll sicker populations. But in practice, effectively carrying out such risk adjustment is difficult.[5] See Paul Starr, "Perils of the Public Plan," The American Prospect, June 29, 2009. For an example of international experience with the problem of risk selection by insurers, see Kieke G.H. Okma, "Recent Changes in Dutch Health Insurance: Individual Mandate or Social Insurance?," in Expanding Access to Health Care, edited by Terry F. Buss and Paul N. Van de Water (M.E. Sharpe, 2009).

A second rationale for establishing a public plan is that it could effectively control its health spending. Like Medicare, a new federal health insurance program for Americans under sixty-five has the capacity—with its purchasing power—to restrain the prices it pays to hospitals, doctors, and other medical providers. Such a public plan, which would not need to make profits, almost surely would have lower administrative costs than private plans—for example, the traditional Medicare program devotes only 2 percent of its expenditures to administration, as compared to 11 percent for private Medicare Advantage plans. The potential for savings is significant. The United States has the most expensive health care in the world largely because we pay higher medical prices and incur higher administrative costs than other nations. (Greater use of some expensive medical technologies is another source of higher spending.)[6] [6]McKinsey Global Institute, "Accounting for the Cost of Health Care in the United States," January 2007; Gerard F. Anderson et al, "It's the Prices, Stupid: Why the United States Is So Different from Other Countries," Health Affairs, Vol. 22, No. 3 (May/June 2003).

That advantage explains why the insurance industry is trying to kill a public plan.[7] Insurers argue that they would face an "un-level playing field" in competing against any public program, since the federal government would inevitably favor its own plan. Yet Medicare's experience with such competition suggests that there is nothing inevitable about that alleged bias. The government now pays private insurers who enroll Medicare patients significantly more than it costs to treat them, enabling private plans both to offer better benefits than the traditional Medicare program and to make a profit.[8]

[7]The physician and former governor Howard Dean, in his new book, Prescription for Real Healthcare Reform (Chelsea Green, 2009), similarly argues that "if the Medicare-like public option could use its efficiency to deliver high-quality, cost-effective care, it would attract more enrollees. After all, this is the crux of why conservatives and the private insurance industry so vigorously object to a public plan. Their real concern is sacrificing profits to competition." ... http://www.nybooks.com/articles/22931

[8]The Obama administration has proposed cutting these excessive payments to private insurers offering Medicare Advantage plans.

The insurance industry is, in fact, not interested in anything like a "level playing field." Buffeted by the erosion of employer-sponsored insurance, the industry now welcomes the prospect of health reform that extends private insurance to the uninsured. But insurance firms do not want to lose new or existing customers (and profits) to a public competitor. New York Senator Chuck Schumer had proposed rules that circumscribe a public plan in order to ensure fair competition with private insurance. Schumer's public plan would not be administered by the same officials who run the planned new insurance exchange; it would be financed only from beneficiary premiums and co-payments; and it would make a concession to the medical industry by paying higher rates to hospitals and doctors than Medicare currently does. Those stipulations have predictably not softened the insurance industry's opposition. The American Medical Association, fearing the impact on physician incomes, also opposes both a strong public option and one such as Schumer's.[9] ...

[9]The irony is that, on the one hand, conservatives oppose the public plan because it will be so inexpensive it will drive out private insurance, while on the other hand, these same critics decry the inefficiency and unaffordability of government programs. For an example, see Karl Rove, "How to Stop Socialized Health Care," TheWall Street Journal, June 11, 2009.

[10]See Arnold Relman, "The Health Reform We Need and Are Not Getting," The New York Review, July 2, 2009.

[11]See Joseph White, Competing Solutions: American Health Care Proposals and International Experience (Brookings Institution, 1995).

[12]For a fuller discussion of the limited cost-control potential of prevention, electronic medical records, and other delivery system reforms, see Theodore Marmor, Jonathan Oberlander, and Joseph White, "The Obama Administration's Options for Health Care Cost Control: Hope vs Reality," Annals of Internal Medicine, Vol. 150, No. 7 (April 2009).

[13]For a fuller elaboration of the axiom about medical spending and its political implications, see Robert G, Evans, Strained Mercy: The Economics of Canadian Health Care (Butterworths, 1984) and Theodore R. Marmor, Political Analysis and American Medical Care (Cambridge University Press, 1983).

[14]See Jonathan Oberlander, "Picking the Right Poison: Options for Funding Health Care Reform,"New England Journal of Medicine, Vol. 360, No. 20 (May 2009).

[15]President Obama and congressional leaders are committed to adopting health reform legislation that adheres to pay-as-you-go budgeting rules. That means such legislation must be fully paid for with tax increases and/or spending cuts to remain "budget neutral."

[16]Under the Byrd rule, legislative provisions can be challenged, and ultimately removed from a reconciliation bill, by senators on the grounds that they are that are extraneous to federal spending or revenue decisions. The Senate parliamentarian ultimately determines whether legislative provisions are extraneous. See Rebecca Adams, "The Risks of Using Reconciliation for Health Care Legislation,"Congressional Quarterly, April 2009.

[17]On the Obama administration's theory of legislating reform—"pass a bill, take what you can get, and fix it later"—see Michael Tomasky's discussion in "The Unencumbered Man," The New York Review, July 2, 2009. In late June, Sheryl Gay Stolberg, a White House reporter for The New York Times, wrote in a front-page article that the President "has invested so much capital in a health care bill that not to have legislation would be politically disastrous for him." See "Obama Steers Health Debate Out of Capital," The New York Times, June 30, 2009.